Brian Hayes (Dublin South West, Fine Gael) | Oireachtas source

That is the view of the OECD. Our effective corporate tax rate is within 1%. In France, as Deputy Ross stated, which has a headline rate of 35%, the effective rate is somewhere south of 9%. There are various provincial discounts that countries employ that could be brought to bear in France and elsewhere. This is a competitive business. Even though we are in the European Union, and in many respects we have an integrated policy on a key range of areas, tax is an outstanding issue of domestic reserve within each member state, and that is as it should be because tax policy competition is essential in ensuring we keep business in Europe. Otherwise, those businesses will migrate to other parts of the world. We have an upfront, honest position where our effective tax rate is within 1% of the actual headline rate. That is not the case in other countries.

Huge sums of money are being made in the digital economy. When a consumer buys an iPhone or an iPad, 90% of its cost is not the circuits or the work that goes into creating those devices, rather it is the intellectual property, IP, that goes into designing and ensuring those devices have been made correctly. The fact that Bermuda can offer 0% to allow the IPs reside there is not the fault of the Irish Government. That is an issue for Bermuda, the Virgin Islands or many of the Crown dependency territories with which other members of the EU have an extraordinary relationship. That is the issue no one is speaking about, namely, these huge companies which can diversify at very low if not zero rates of tax in some parts of the world. We do not have special rates. This morning, the chief executive officer of Apple confirmed that fact. It is the position of the Irish Government that every effort will be made to take up the point colleagues have raised to ensure that issue is brought to bear.

There are things we can do but we must do them in the context of an EU-wide agreement. The biggest thing we must do is automatic exchange of tax information. There is a new gold standard which the US Congress is rightly demanding. For instance, we were the second country in the European Union and the fourth in the world to sign an automatic tax information exchange agreement. In other words, the Inland Revenue Service receives from the Irish Revenue on an annualised basis the tax affairs of companies and of US individuals in this country and vice versa. That is the new gold standard on which the OECD and the United States are looking to come into agreement, and that is the standard we are seeking to employ across the European Union in our work as holders of Presidency. We have nothing to be ashamed about or to apologise for in this area. We have a very strong record of tax compliance in this country. That is the way it should be, and that is the way it will continue.

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