Leo Varadkar (Dublin West, Fine Gael) | Oireachtas source

At the meeting with Sheryl Sandberg, we principally discussed the operations of Facebook in Ireland. It is expanding and will take on a few hundred extra people, in particular in East Wall. We discussed how more could be done to protect social media users, particularly children. There was a discussion with the US companies present on their perspectives on the tax changes that have been made in the United States. They had mixed views in that regard. Most welcomed the reduction in corporation tax and that they can repatriate profits to the US but, as some pointed out, some companies are worse off as a result of the changes because of the elimination of many exemptions and reliefs, which I did not expect to hear. They do not think it will have any impact on investment in Ireland but it may make future investment more attractive in the US than is currently the case. I was not present for discussion of a financial transaction tax.

The Department of Finance is working on an impact study on digital taxation but it is difficult to carry out an impact study when there is no clear or definite proposal as to how a digital tax may work. Neither the OECD nor the European Union have produced such a proposal. To carry out an impact analysis on a proposal that does not yet exist is quite difficult. A feature of a digital tax that does not make sense is that the tax be applied at the point of sale. We do not do so for other industries. To take cars as an example, huge numbers of cars are made by Volkswagen in Germany and Renault in France and the profits those companies make are taxed in France and Germany, not the countries in which the cars are sold. I do not see why one would tax profits at point of sale in the digital industry but in other industries one would do the reverse.

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