Tax transparency rules would have 'serious implications' for Ireland's competitiveness

Planned EU rules for country-by-country tax reporting by multinationals would have “serious implications” for Ireland’s competitiveness and ability to attract investment to the country, a Department of Enterprise, Trade and Employment briefing said. The briefing said it was “strongly recommended” that Minister of State Robert Troy should make an intervention to oppose the tax changes at a public debate.

The EU wants the new law to force multinationals to report their tax payments and activities for each member state to increase transparency.

However, a departmental briefing warned this would not benefit Ireland and was likely to impact investment from inside and outside the EU.

The brief said: “This proposal has serious implications for our competitiveness and ability to attract FDI [foreign direct investment] from both within and outside the EU, as countries including the US and Japan oppose publication of tax information.” 

Possible conflict

It also warned Mr Robert Troy of a possible conflict where he would be speaking against the change while it was being supported by Ireland’s EU Commissioner Mairead McGuinness.

“This means a commissioner from Ireland will speak in favour of a proposal while Ireland will intervene in opposition,” the record said.

Access to the briefing had originally been refused by the Department of Enterprise, Trade, and Employment but was released following an appeal.

Mr Troy was told the matter had been deadlocked since 2016 but that the EU Presidency now had enough support – 18 member states – to move it forward.

It said Ireland should "continue to speak” against the proposal, along with what were described as “six other like-minded member states”.

Principled opposition

The briefing said any comments Mr Troy made were unlikely to halt the changes but would reinforce Ireland’s “principled opposition” to the move.

The briefing note said: “[Your remarks] are unlikely to change the Commission’s or supporting EU member states’ views on the legal basis of the file.

“However, Ireland’s position should be maintained to ensure our principled opposition to the file proceeding … on the current legal basis is noted along with our commitment more generally to transparency.” 

It said an intervention was strongly recommended and that this approach had been discussed with both Tánaiste Leo Varadkar and Minister for Finance Paschal Donohoe.

Tax measure

Ireland has consistently opposed the changes because they consider it a tax measure, which the Government claims should be dealt with using different legislation and by finance ministers.

This would mean unanimous support would be required rather than a qualified majority, meaning the new laws could be vetoed by a member state.

The briefing also provided a background note for Mr Troy, saying the taxation move was “very controversial”. 

“Ireland has consistently voiced our opposition to the file proceeding … on a principled basis,” it added.

Asked about the briefing, a department spokeswoman said: “A public policy debate on public country-by-country reporting took place at the Informal Competitiveness Council on 25 February. Robert Troy … set out Ireland’s position at this council meeting.”

 

https://www.irishexaminer.com/business/economy/arid-40262192.html

How to contact us

Please do not hesitate to contact us with any queries you may have.

Send us a message


Voodoo Ltd

4-8 Hope Street, Douglas, Isle of Man

Phone: +44 (0) 1624 610122

Email: ask@voodoo.im