Professor Frank Barry:

The PwC report is the same as the World Bank study to which I referred, and they were done in tandem. They take a hypothetical company, exactly as Deputy Doherty states, which is a producer of ceramics which has no exports, and asks what tax rate this company would pay in every country. It is how it came up with its number. It is a bizarre company which is not reflective of the real companies that operate in the world. That is why I dismiss these studies. It is what I call a back-of-an-envelope study. It is done over the space of a few months. I prefer to rely on academics, whose entire life's work is working out how to evaluate appropriate tax rates. Amazingly, 11.1% is close enough to 11.8%, but what really matters is how other countries are ranked. In the PwC study the rate for France was 5% or 6%, whereas in the academic studies it comes in closer to 30%. These numbers are much more plausible because they fit in with the logic, as I explained, of why centrally located large industrialised countries invariably tend to have higher effective tax rates. These numbers are much more credible.