Ms Kate Levey:

If profits are generated in Ireland, the company has the benefit of the 12.5% rate. If it is part of a multinational group that operates throughout the EU and will now be subject to the CCCTB, the Deputy is correct, its profits will be allocated on a different basis throughout the whole of the EU, including that sales factor that has a particular impact on us.

Therefore, more of the profits will be allocated outside Ireland and less profit will benefit from the 12.5% rate. This would make Ireland comparatively less attractive.

Incentives such as the research and development tax credit are designed to increase the amount of research and development. Incentives like that will disappear. The ability to differentiate by way of particular tax incentives will disappear under the CCCTB. This is another reason why there might be an impact on foreign direct investment.