Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

I move amendment No. 113:

In page 46, between lines 31 and 32, to insert the following: "25.The Minister shall, within six months from the passing of this Act, prepare and lay before Dáil Éireann a report on the role and sustainability of Corporation Tax receipts as an element of the tax collected within the State.".

This amendment relates to corporation tax. We need to start considering the sustainability of corporation tax receipts. I have referred on the record on a number of occasions to the vulnerability of our corporation tax receipts.

I hope that they will be sustained, but two issues arise. There has been a large increase in corporation tax receipts, but there has also been a concentration in those, with 40% of them paid by just ten companies in 2015. In 2009, the figure was 21 companies. This raises a question of vulnerability. International factors are outside of our control, but we need to start considering how to deal with our bumper corporation tax receipts of recent years compared with previous years. In 2015, corporation tax paid by the top ten companies amounted to 6% of our overall Exchequer tax revenue. That is the same amount that the State was accruing in stamp duty in 2007. There has been a great deal of discussion about stamp duty being relied on at that time and inappropriate fiscal decisions being made as a result of stamp duty and other property-related taxes, but stamp duty in 2007 amounted to the same as ten companies' corporation tax payments in 2015. I want every company that is in Ireland staying here. I want their taxes to continue being paid in Ireland. From the State's perspective, changes for the better have been made to corporation tax, but it is highly mobile and changes can be easily reversed. When there is such a concentration, there are vulnerabilities.

We must be calm and measured. When people start debating corporation tax, we sometimes seem to get very excited. Many people have different opinions on whether the rate should increase or decrease. For the majority of Members in the Houses, however, there is a settled view on corporation tax rates. There may be issues around the margins, albeit substantial ones, but the question is not on the tax itself or our offering, but on how we should deal with it and plan for the future. If we had a time chamber and went back to 2007, we would be sitting around this table and saying that we should not be basing our public finances on stamp duty. I am not saying that the public finances should not be planned on the basis of corporation tax. There will always be a level of corporation tax in the overall tax take. For example, ours is approximately 15% compared with the EU average of 10%. However, when ten companies pay 6% of the overall tax take, it raises an issue. It is imprudent to plan for the future on that basis. It accounts for a large amount of our tax take and there is a high concentration following a significant increase in recent years. I presume that the concentration will only intensify as the years go by. Therefore, we need to consider this matter in a prudent and fiscally responsible way.

To start that discussion, and perhaps using the budgetary committee, the Department should report on changes in corporation tax, the level of concentration and what can be done, if anything. For example, should we plan for the future on the basis of those corporation tax receipts or should we be more prudent and, although we are taking in a certain amount now, leave some aside from a fiscal planning point of view because of a possible vulnerability? I am not arguing that we should do the latter, but there must be a discussion on the concentration in those receipts.