Sustainability of the precious 12.5% Corporation Tax

Rising objection in Europe to the 12.5% corporation tax in Ireland coupled with the objectives of the 4 year plan has lead me to wonder about the sustainability of the corporation tax and its competitiveness. The 4 year plan highlights are a rise in V.A.T, a reduced minimum wage and the introduction of new taxes like water tax but no change to our corporation tax. This protection of a source of potentially a huge tax revenue (with only a small increase in the tax rate) places the tax rate central to the Irish governments strategy for future growth. How long will this last with Europe's rising interest the level of corporation tax and with the U.K announcing today a cut in corporation tax, to stop domestic companies setting their base in Ireland and encourage them to stay in the U.K.

These events may force Ireland to rise the corporate tax rate as the cut in U.K corporate tax may be followed with future cuts and other European countries following the U.K's example. 12.5% may not give us such a competitive advantage as it has done with rising tax rates in other areas of Irish products and services.