Mr. Brian Hayes:

As we discussed earlier, the proposal by Pierre Moscovici is on the turnover, which is a very crude measure. Many of the questions to the Commissioner in ECON were on how he would assess this. It would be self-administered by companies with regard to how many users they had in Apple, Google and Airbnb, which is effectively deciding that policy within each company. They see it as an additional amount, not as a substitute on existing tax that is paid. They do not see it as a potential write-off for the purposes the Italians might be using at present. I do not see that proposal working. However, I see some movement. The Deputy asked about the trade off. The trade off could well be some movement on digital tax over a period of time as an interim measure before the OECD can come to an agreement with possibly a sunset element. As I said in my statement earlier, there is some potential in that, with the trade off ultimately being for member states to believe that the wider question on the corporate tax base and consolidation would be left to another day.

To be frank, the bigger concern for Ireland is the CCCTB issue, not digital tax, because of its additionality. The Germans, and this has only changed since the new Finance Minister took over, are now very concerned about the impact this is going to have with the United States of America in this tit-for-tat warfare between the US and the EU. Consider the very hefty fine that was given to Deutsche Bank, during the Obama Administration, for a tiny indiscretion which most American bankers would feel was totally disproportionate. However, then they say in the next breath, "Well look at how you are treating Apple. We will treat Deutsche Bank this way". The whole thing disconnects itself. I believe the Germans are very concerned at present that this can turn into a tit-for-tat. As the Deputy knows, proposals that are made in the last year of a Commission are generally ironed out much later. However, potentially there will be a trade off by accepting some type of digital tax on the basis that the broader issue of CCCTB is left to one side. That is my political sense at present.