As president of Bank of America Merrill Lynch and also president of American Chamber of Commerce, Peter Keegan is an important voice on our economy. As the head of Bank of America Merrill Lynch he is in charge of close to 1,500 staff in Ireland, dealing in matters as diverse as credit card services to foreign exchange trading.
In addition to his job as head of one of the biggest financial services firms in the country, Mr Keegan has taken over as president of the American Chamber of Commerce, making his one of the most important voices in the debate over tax and the future direction of the economy.
Given his profession – he is a qualified accountant – and his position, the tax regime is an obvious priority for him and the Chamber. Perhaps surprisingly though, he does not appear overly concerned about our corporation tax rate. For him, the key at the moment is personal tax rates.
“Maintaining our corporation tax is the cornerstone, of course, but we need to look at the whole tax regime and that means the integrity of the tax regime and Ireland is a very open and transparent system and it needs to be seen to be that as well,” he says.
“Things that make Ireland attractive are the 68 double tax agreements with other countries, the capital allowances regime, and income tax.
“The top rate of tax at 52pc which kicks in at just €35,000 is as high as it should go. It’s a tax on employment and a tax on talent that is where we are coming from.
“Look, we know that in certain levels of the economy such as high end ICT and languages, we need to be able to attract people into Ireland to work, and we also want to be able to hold on to the homegrown talent we have.
“Income tax rates play a very strong role in whether that is possible. Everyone understands the government has a difficult path to walk at the moment but income tax rates are about as high as they can go.”
Income tax is an important point for sure, but it has not been grabbing the headlines in recent times. Beyond the bottom line corporation tax rate, we have seen more and more countries kicking up about multinationals avoiding tax through perfectly legitimate means. That has led to accusations from people in high places such as US senator Carl Levin that Ireland is some sort of “tax haven”. It is a point Mr Keegan is quick to pounce on.