Gerry Adams (Louth, Sinn Fein) | Oireachtas source

The Taoiseach says it is not true and he could be right, but the fact is that, if he is right, this needs to be corrected. The US Senate report also states Apple uses what it describes as tax havens such as this State, Bermuda and the Cayman Islands. The Taoiseach says the tax regime here is transparent and based on statute, but it seems these statutes permit tax avoidance strategies. There is a world of difference between maintaining a competitive tax regime and colluding with companies in order that they can avoid paying tax. The reality is that many large companies are using tax loopholes and reliefs to lower their effective tax rate well below the 12.5% corporation tax rate. God knows how many other companies are benefiting from this regime through their aggressive tax avoidance strategies. There is always a temptation for a government, particularly a government such as the Taoiseach's, to bend to the will of companies which are threatening to pull out unless they get their way in terms of their tax strategies. While it may be that the tax system is transparent, it is transparently flawed. It is not fair and we need a better system. There has never been a system so nakedly designed to legalise tax avoidance and tax limiting. Moreover, who is it for? The tax take does not reflect the level of business multinationals do here and the job numbers are not reflected in the level of business on which the Government justifies doing these deals. Who exactly is writing the Government's tax code? Everyone should pay his or her fair share and that includes these very profitable companies. At a time when people across the State are struggling with hikes in PRSI, VAT, motor tax, the new family home tax and threatened water charges, these big companies should not be allowed to avoid their obligations.

In the past few years there has been a huge increase in royalty payments being repatriated out of the State, yet, at the same time, our corporation tax take has decreased. It is obvious that while some tax reliefs serve a useful social or economic reason, others simply fly in the face of reason. Take, for example, the Government’s special assignee relief programme, SARP. This was a key part of the 2012 budget and supposed to be a job creation measure. However, while the number of jobs created under the scheme is approximately 26, income write-offs are granted to high earning executives and, on average, beneficiaries receive an additional €20,000 income tax-free, despite earning an average figure of over €130,000.

That €20,000 would be far more beneficial going into struggling indigenous SMEs. Questions have also been raised about the shadow banking sector. A modest sized building in the IFSC hosts 250 financial services companies but the reality is that many of them do not have staff or desks and pay little or no tax. The shadow banking sector in this State is valued at about €1.7 trillion, which is ten times our annual GNP.

I am all for job creation and Sinn Féin has always applauded jobs when they have been brought here by dint of local efforts or those of the Government and other agencies. I know there have been huge job losses among bank employees and others in the financial sector who were not responsible for the crash. However, it was the unregulated nature of this sector that led to the crash so we should not mesmerised by what is happening now. These sectors need to be regulated and pay their fair share of tax.

I welcome the fact that this issue is being considered at this week's European Council but it needs to be dealt with in a way that is not a cover for attacking our 12.5% corporation tax rate. The problem is not the rate but the variety of mechanisms that allow companies to avoid paying anything like the 12.5% rate, which means that ordinary citizens are then forced to pick up the tab with more taxes and austerity.

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