Enda Kenny (Mayo, Fine Gael) | Oireachtas source

The discussions were not about the 12.5% corporation tax rate in place here as corporation tax is a matter for individual countries. The rate we have set has been a cornerstone of our policy for a very long time.

I agree with Deputies Adams and Martin that the question of reputational damage is an issue. It arises from some of the comments made following the United States Senate hearings last year about this country being a tax haven when clearly Ireland does not qualify under any of the headings for tax haven status. It took a while to deal with that argument comprehensively and clearly. In view of reputational damage or perception of reputational damage, the Minister for Finance abolished the stateless concept in the budget last year. That was a clear decision to remove any perception of difficulty from an Irish point of view.

Governor Brown's comments in California arose at an occasion where quite a number of small Irish companies had gone through an analysis and presentation of their products and what they intended to offer and pitched to potential investors in California to invest in their businesses. Some of them were very exciting concepts designed here by Irish people. Governor Brown certainly has a sense of humour and, obviously, people can play words the way they want. He has transformed the Californian economy, where there was a $27 billion deficit, to a point where it is making serious progress, not, I might add, without taking significant and difficult decisions.

When Deputy Adams mentions companies paying the tax rate that applies here, it is important to state we do not have the brass-plate system in Ireland. For instance, I visited Apple in California last week. When one goes to its ultra-modern facility in Cork where over 4,000 highly-skilled people are employed one can understand the contribution it is making to the economy of Cork, both city and region, along with its presence in a number of other countries. Companies which employ significant numbers here pay the tax and their workers pay tax, but in the BEPS initiative the OECD is dealing with the 15 different areas internationally so that there can be an international response to have a fair system that everybody understands. We are participating fully, openly and comprehensively in that, and have done so from the outset.

Deputy Adams raised a number of interesting points about Africa. Prior to the Olympic Games, British Prime Minister Cameron called a meeting in London with a number of African leaders who spoke about discrimination against women and young girls, discrimination in education, corruption and the difficulties that many countries in the African continent experience. It is evident, if the population of Africa doubles in the next 20 years, as it probably will, that even if 10% of young males were to decide to emigrate from the African Continent, no country in Europe could withstand the scale of that pressure and it is necessary that democratisation and anti-corruption measures be put in place in Africa. A number of African leaders addressed the G8 summit in Lough Erne and what they said was startling in its effect in that companies, and in some cases countries, which do deals with phenomenal amounts of African land, supply all the legal requirements at the start of a contract but there is never an analysis as to the impact for the peoples, the tribes or the economies of the regions. The point was made by President Obama at that meeting that the G8 could supply expertise and experience in contract law and treaty agreements so that African countries or their regions would be able to avail of the best expertise on what they are being asked to sign. An example would be the rape of the land for mineral extraction to no benefit for the African people or the regional economies. Some of the leaders gave examples of where a truck-load of mineral clay or whatever driving 20 miles might be stopped 50 to 100 times for payment.

There is an issue here that goes to the heart of the matter, that is, corruption and greed. Clearly, significant amounts of money have been drifting into some bank accounts to the disadvantage of millions of people, tribes and local areas. That was an issue on which the G8 was to follow up, where expertise could be made available to countries and regions to state what they are being asked to do, what is the agreement that they are being asked to sign and how is it that there cannot be much greater benefit for the people and the area depending on the nature of the contract in place. I suppose, when the gentleman Deputy Adams quotes states that all companies should pay their taxes in Africa, perhaps that may be a reason that some do not. In any event, Ireland's participation and support for the OECD's work on the BEPS covering the 15 areas that I mentioned to Deputy Martin is something that we hope can bring about an international response to the different regimes that apply in different countries.

Ireland's participation in the OECD does not mean that we have to change our tax laws. The OECD does not have the power to do that. It is anticipated that the OECD analysis of BEPS will result in changes being made to the international taxation rule-book on which countries rely for international trade. We always have played by these rules and that is evidenced by the extent of the strength of the continued line of investment into the country. These issues are under active consideration. We participate in that, openly and fully, and we look forward to dealing with the response.

The Commission's investigation is not a global issue. The Commission's investigation here in Ireland is on a specific technical point for a specific company. That is not an issue that applies globally. The Commission has a slightly different investigation taking place in Luxembourg and in the Netherlands with other companies.

The bigger picture is how does one respond to the digital world having moved so far ahead of the legislative world that companies can move through different jurisdictions, regimes and tax operations before a baseline is reached. For us, with companies here in Ireland, there are no brass-plate operations. We believe strongly that, as ours is a statute-based law, it is not a state aid and it is ethically implemented. We work on that up-front basis with the OECD and we will defend our position strongly with the European Commission.

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