Mr. Gerard Brady:

On corporation tax, last year Seamus Coffey commented on the common consolidated corporate tax base, CCCTB, rather than base erosion and profit shifting, BEPS. In the space of a year there has been a significant political change on global corporate tax. When Seamus Coffey referred to the CCCTB, there was little chance of it ever happening purely because, as he said, we had a veto at European level, as did other member states. At the OECD in the BEPS process, there is no veto. In effect, power talks. On those proposals which are risky for Ireland, every large country is on one side of the table while a handful of smaller countries, along with ourselves, are on the other side saying we need to make it work for small countries. As Mr. Fergal O’Brien said in his opening statement, fundamentally, this is not about closing loopholes but about who pays tax where. Big countries want more money paid into their exchequers because that is where the consumers are. The politics of BEPS has changed significantly. In particular, the US position on tax has changed enormously over the past year. We would have regarded the US as being on our side of the table, along with Germany. Those two countries have switched sides over the past year.

I would put high odds on there being an agreement at the OECD with two outcomes. No matter the results of the negotiations, some of our tax under pillar 1 will go to other countries. We reckon that could be as high as €2 billion to €3 billion in a worst-case scenario. Even in a relatively benign scenario, one is still talking about €1 billion lost from our tax base.