New tonnage tax reaps immediate benefits for Irish shipping fleet

A new tonnage tax regime introduced in the budget this week has already had a positive impact on the Irish Shipping Industry. Arklow Shipping has announced that the MV Arklow Rose, launched today in Holland, and a sister ship to be launched later next year, will join the Irish Register based on the new measures alone. This represents an investment of €15M.

The MV Arklow Rose is a 4500t dry bulk cargo vessel. The vessel will join the Irish Register, be crewed by Irish personnel and fly the Irish flag. The Irish Fleet has suffered during the past 10 years with a drop of 50% in the total numbers of vessels registered and with a similar loss in the number of Irish seafarers serving onboard Irish vessels. The tonnage tax will assist in halting and reversing the decline.

"The immediate impact that tonnage tax will have on the Irish Shipping industry is reflected our decision to join the Irish register", said Pat Corcoran, Financial Director Arklow Shipping Ltd. "We are encouraged by the positive action taken by the Government on this issue and can now see real potential for the growth of the Irish Shipping and shipping service industry here in Ireland", he added

Tonnage tax means that a company will be taxed based on tonnage and not notional corporate profits. Shipping companies will now have the choice to opt for this new form of taxation based not on actual profits or losses but essentially on the size / tonnage of their ships.

"It is clear that the tide is turning for the Irish Shipping sector," said Glenn Murphy, Director of the Irish Maritime Development Office. "Tonnage tax is the catalyst that will facilitate economic growth in the sector and provide jobs ashore and at sea", he concluded.

The Irish Maritime Development Office as part of the Marine Institute is the national agency for promotion and development of the shipping and shipping service sector.