Eamon Gilmore (Dún Laoghaire, Labour) | Oireachtas source

Will the Deputy please do me the courtesy of listening to the answer? The corporation tax rate of 12.5% is established in law. No special tax rate deals apply to any individual company. We do not have any special low corporation tax rate regimes or arrangement for any multinational company. The tax rate which is established in law applies evenly to all companies. It is 12.5% on the trading profits in Ireland and 25% on non-trading income in this country.

An issue arises because of the differences in the legal and tax systems between countries. International tax planning takes advantage of these differences in national systems and rules and Ireland has been working for some time to address these issues. We have been working at OECD and European Union levels to examine these structures and consider how international rules can be implemented to ensure fair levels of taxation. I chaired a meeting of the General Affairs Council of the European Union yesterday, at which this issue was on the agenda in preparation for today's European Council meeting. In our capacity as President of the European Union, we have been advocating addressing the issues of tax evasion, tax fraud and aggressive tax avoidance by companies operating internationally. We are advancing a series of measures to deal with them. The Minister for Finance, Deputy Michael Noonan, together with the EU Tax Commissioner, circulated a letter setting out seven proposals on how this issue will be deal with at European Union level.

In addition, the OECD has a project on base erosion and profit-sharing which deals with these issues. Ireland is one of the strong supporters of that approach being taken by the OECD. In December last year Ireland became one of the first countries to sign an agreement with the United States to improve international tax compliance and implement the Foreign Account Tax Compliance Act. This type of agreement is being hailed as the emerging international standard for the automatic exchange of tax information. The issue of the use of the differences between the tax regimes in different states is being and can only be addressed at an international level. We support that approach. We are one of the leaders in seeking to have these tax loopholes addressed at European Union and OECD levels. In the meantime, our tax regime is established in law. There is one law for corporations. There are not different laws and different standards applying to different companies, nor are different arrangements made with different companies in respect of the tax rate. There is one law and it applies evenly to all companies.

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