Mr. Pascal Saint-Amans:

I thank the Chairman. It is a pleasure to be with the joint sub-committee, even if from a long distance away. I am Pascal Saint-Amans and I am director of the OECD Centre for Tax Policy and Administration. As the joint sub-committee is aware, the OECD is an organisation of 34 member countries, including Ireland. We work in many areas, including that which relates to tax. The OECD has a Committee on Fiscal Affairs - the membership of which comprises the tax policy directors of the member countries - that meets twice a year. We have many working parties which conduct our technical work. In their work, these committees and parties are serviced by the secretariat of which I am in charge. Some of our work relates to tax policy analysis and the economic aspects of such analysis. Mainly, however, our main work relates to international tax law, that is, international tax treaties to eliminate double taxation, transfer pricing rules and international corporations, which includes exchange of information. This work is based on the model tax convention, which was first elaborated by the League of Nations in the 1920s and which was taken on by the OECD in the 1950s. Our work is aimed at eliminating double taxation, favouring cross-border investment and encouraging better co-operation between governments in order to ensure that the tax sovereignty of states is protected.

I have been asked to testify before the joint sub-committee in order to outline some of the hot topics with which we are currently dealing. At the weekend, among the key topics discussed by G20 Finance Ministers were base erosion, profit shifting and the automatic exchange of information. In the context of combating base erosion and profit shifting, we launched a project last year which is being conducted within the OECD. We operate on a consensus basis in this regard and this means that progress cannot be made without all the countries involved either reaching agreement on a particular subject or at least not objecting to a particular course of action. Our work in this area is focused on addressing one of the key challenges which has arisen in the current international environment, namely, the fact that as a result of the gap between the way international tax rules have evolved and the way business has changed, there are now wide avenues which multinational companies that are exposed to international transactions can in order to avoid paying tax anywhere. This is what a number of observers have referred to as double non-taxation. The action plan we have brought forward in the context of addressing this issue is based on the report we produced in February.

Our goal in this area is to ensure that companies pay taxes in at least one place and that we bring an end to the disconnect between the location of the profits and the location where the activity takes place while ensuring that we will continue with the elimination of double taxation. By reaching a balance in this regard, we are of the view that we will be in a position to ensure adherence to the international standards which are absolutely necessary in the context of creating certainty and providing a nice environment in which businesses can operate, invest and create growth and jobs.