Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

I thank the Deputy, who will appreciate why I will not comment on the affairs of any particular taxpayer or commentary about them. The Deputy asked if the ratification of this treaty would change tax laws for copyright or any earnings from music. I do not believe they will although I do not have information in front of me about how the Netherlands taxes copyright or income from music.

With regard to how the ratification of this treaty will deal with the issues to which the Deputy referred, much of the answer is contained in Article 22 of the treaty, which is also referenced in the protocol for Switzerland. In Article 22, we are introducing what is referred to as a principal purpose test, PPT. This will deny treaty benefits to taxpayers when one of the principal purposes of any arrangement or transaction carried out by the taxpayer is to obtain a treaty benefit unless it is established that granting the benefit would be in accordance with the provisions of the double taxation agreement, DTA. This seeks to give more power to tax authorities to ensure that the interaction and engagement between different tax jurisdictions does not create an opportunity for highly aggressive tax planning or some of the issues the Deputy has mentioned. Revenue's investigation division has reviewed the material that has come from the various leaks the Deputy has referred to and information that has come into the public domain. I am always willing to make available any resource or additional power that the investigations division of the revenue needs to pursue this work because I know how important it is.

There are two significant changes in dealing with the issues the Deputy referred to but we are only in the early part of them. The first is the exchange of information between different tax authorities that is now enabled by more countries ratifying the OECD convention. I believe it will be a substantial development in ensuring that taxpayers meet the commitments that they have in different countries. It is too early to put a figure on the additional revenue that it has brought to us but I am confident that, over time, that change will make a significant difference to the issues the Deputy raised. The other thing that will accompany that is the global intangible low-taxed income, GILTI, provision under President Trump's corporate tax reforms and the requirement that it now has for American companies to have a minimum tax rate of 13.125%. If one combines that change with the work of the BEPS process, I believe there will be a significant change in the coming period in the ability to evade tax commitments and a consequent increase in tax revenue in different jurisdictions across the world.