Peter Fitzpatrick (Louth, Fine Gael) | Oireachtas source

I welcome the opportunity to take part in this evening's debate. Profit shifting is a global phenomenon and it will require a global approach to find a solution that is fair to everyone. The OECD this month published a range of detailed reports arising from its base erosion and profit shifting project. The overall aim of the project was to prevent double non-taxation which came about as a result of inequalities in international tax rules and also to better align the right to tax with real economic substance and activity on a country-by-country basis. As a Government, we have been supportive of the BEPS project which, it must be noted, aligns with our own tax strategy and we will now play an active part to ensure that the recommendations are implemented.

Ireland relies heavily on foreign direct investment. Indeed, in my constituency of Louth, we have secured one in ten of all new jobs brought into Ireland by foreign direct investment. In Dundalk, 450 new jobs have been created by eBay, 400 new jobs in Paypal, 200 new jobs in National Pen, which is also looking to create an additional 60 permanent positions shortly, and 100 in Sales Sense. In mid-Louth, the rate of unemployment has fallen by over 30% while in Drogheda it has fallen by over 24% since March 2011. It has been proven time and time again that the only way out of poverty is full-time employment and making work pay. We must also deal in real facts. Ireland is below the EU average for people who are at risk of poverty. Ireland has the most progressive income tax system in the EU. The top 1% of income earners pay 24% of the total income tax and USC, the top 6% pay 44% and the top 24% pay 80% of all income tax and USC. Middle earners pay above the OECD average in tax but below average wage earners pay substantially less tax than the OECD average. The Opposition and indeed certain sections of the news media would have one believe that the tax revenue received from companies is way below what it should be, but if we deal in real facts we see that tax revenue from companies is almost the same as the OECD average. For example, we take in 8% of total tax revenue through corporation tax compared to the average of 9% in the OECD. The Department of Finance carried out a detailed study and best estimates indicate that the effective corporation tax rate in Ireland since 2003 has been 11%. If we compare that to France, which has an effective corporation tax rate of 7.4%, we can clearly see that Ireland is not abusing its position in relation to corporation tax. It is my firm belief that a low corporation tax rate attracts jobs as can be seen by the fact that IDA Ireland companies in Ireland currently employ over 174,000 people.

Fine Gael's economic plan is delivering on its promises. We are replacing all the jobs lost during the recession and are working towards 6% unemployment. We are making work pay through a combination of cuts in tax, a higher minimum wage and more affordable child care. We are protecting Ireland from future shocks by ensuring that we have a surplus in the public finances and reducing the national debt. In this regard, the forthcoming general election will be a choice between stability and progress or instability and chaos. This country needs a Government that can be trusted to secure the recovery, not one that will put it at major risk. The real facts show that this Fine Gael-led Government has been fair in its approach to bringing the country's finances back under control. We have maintained the core welfare rates of jobseeker's benefit, carer's allowance and the State pension. We have removed 410,000 low-paid workers from the dreaded USC and plan to remove even more. We have cut income tax rates for everybody earning less than €70,000 and restored the minimum wage with plans to increase it.

While I have concerns about some aspects of the issues raised here this evening, the publication of the final BEPS reports along with our commitment to implement the various findings will go a long way to closing any loopholes that exist. What is most important for us now is to secure the recovery that is currently taking place. The recovery is fragile and not enough people are feeling the benefits yet. We must ensure that everyone in all areas benefits from the recovery. We need political and economic stability. Only a Fine Gael-led Government can provide this.

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