Ireland scraps Google tax breaks; Harvey Norman hits back at overpriced shares claim: Midday Roundup

The Irish government announced yesterday it would phase out a key measure used by technology companies, including Google, to reduce their taxation bills.

The tax provision, known as the “double Irish”, enables entities in a corporate structure to shift income from a higher-tax country to a lower-tax country.

While the provision will end next year, companies already using it will be able to continue doing so until the end of 2020.

Ireland’s Finance Minister Michael Noonan said in his budget speech to Parliament on Tuesday: “Aggressive tax planning by the multinational companies has been criticised by governments across the globe and has damaged the reputation of many countries.”

“I am abolishing the ability of companies to use the ‘double Irish’ by changing our residency rules to require all companies registered in Ireland to also be tax resident.”

Noonan’s announcement on Tuesday came after years of complaints about Ireland’s low official corporate tax rate of 12.5%.

Harvey Norman hits back at overpriced shares claim

Gerry Harvey has hit back at a report that identified Harvey Norman as having the world’s most overpriced shares.

Fund manager Sid Choraria, who came first in a competition aimed at identifying the world’s most-overpriced stocks, believes Harvey Norman shares are “priced for perfection” and will fall 35% to 40% over the next 18 months to two years.

But Harvey says Choraria misunderstood Harvey Norman’s business model.

“People go out on limbs to get publicity and they dig things up that get them publicity,” Harvey told Fairfax.

“This guy is on a mission – we know where he’s coming from – and we are entitled to refute his allegations or ignore him.”

Shares up on open

Aussie shares got off to a slow start this morning, following a volatile session on Wall Street overnight.

Tim Radford, global investment manager at Rivkin, said the activity on the US markets overnight serves as a cautionary tale for local investors.

“Wall Street had a strong start to the trading session, as the bulls tried taking advantage of depressed prices, but bears again managed to take control into the close, seeing the broader indices near session lows,” Rivkin said.

The S&P/ASX200 benchmark was up 27 points to 5234.4 points at 12.01pm AEST. On Tuesday, the Dow Jones closed 5.88 points lower, down 0.04% to 16315.2 points.