Mick Wallace (Wexford, Independent) | Oireachtas source

Work on the CCCTB proposal is moving rather slowly, but Ireland is committed to engaging constructively on it under the Euro Plus Pact. I note that the European Union Commissioner with responsibility for tax policy, Mr. Šemeta, has called on Ireland to help push forward the CCCTB proposal during our Presidency. The Government has issues with the maintenance of the 12.5% corporation tax rate and the financial transaction tax, both of which will play a role in the CCCTB proposal eventually. Owing to issues outside Ireland's control, there is no guarantee that we can sustain our low corporation tax rate, which calls into question the wisdom of relying so heavily on that policy.

The Minister will be aware that 11 EU member states are pursuing the development of a financial transaction tax. This group includes four of the five largest member states, namely, France, Germany, Spain and Italy. The 11 countries combined account for 90% of eurozone GDP. Having such a tax makes good sense, given everything that has gone on in the world of financial institutions in recent years.

I understand the Government's fear of losing jobs to London, but we should still sign up to the proposal because it would help to bring certainty and stability to business. The amount of money it would bring in would not be vast and would not be greatly different from stamp duty revenue in this regard. However, it would be a little more. We need to bring stability to the manner in which financial institutions operate, as they have caused so many problems. Aside from getting a fair contribution from them, such a tax would discourage risky trading activities and short-term investments. It would encourage more long-term investments, the lack of which is a major problem in the world today.

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