Paschal Donohoe (Dublin Central, Fine Gael)
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Of course. This section amends section 891H of the Taxes Consolidation Act 1997, which was introduced in the Finance Act 2015 and provides for country-by-country reporting. Section 891H gives effect to the OECD base erosion and profit shifting, BEPS, project recommendations for country-by-country reporting and Council Directive EU 2016/881 of 25 May 2016, which brought the OECD BEPS recommendations for country-by-country reporting into EU legislation.

This reporting was developed by the OECD as part of its package of measures to tackle BEPS. It provides tax authorities with a clear overview of where profits, sales and employees of large multinational groups are located, and where taxes are paid and accrued. It facilitates transparency as these reports can be shared on a confidential basis with tax authorities in other jurisdictions through government-to-government exchange of information.

Section 891H requires an Irish resident ultimate parent company of a large multinational group to provide a country-by-country report to the Revenue Commissioners. The report must contain a breakdown of the amount of revenue, profits, taxes and other indicators of economic activities for each tax jurisdiction in which the multinational group does business. Country-by-country reporting applies to multinational groups where the annual consolidated revenue in the preceding fiscal year is €750 million or more.

This section of the Finance Bill amends section 891H in order to provide that country-by-country legislation is to be interpreted, and country-by-country reports are to be completed in accordance with the relevant OECD guidance.

Section 891H is also amended to legislate for the OECD approach adopted by Ireland for specific circumstances where the OECD guidance provides flexibility in determining whether a group is within scope of the country-by-country reporting requirements, for example, where the preceding fiscal year of the ultimate parent company of the multinational group is shorter than 12 months. This amendment shows our continued commitment to meeting international standards in the area of tax transparency and administrative co-operation.