Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

Our position as a party is very clear: double taxation agreements are good. They can allow citizens to work without being taxed twice. They can, however, also be exploited and used as a way of avoiding tax and of exploiting developing countries.

Regarding this specific agreement, however, has the Minister of State made any estimate of the amount of unrelieved double taxation Irish taxpayers actually suffer in Ghana, given that in the absence of a tax treaty Revenue has already unilaterally offered Irish companies and individuals tax credits for a wide range of foreign taxes incurred, including on dividends, royalties, interest, foreign branch profits, leasing income and capital gains from foreign assets? I would like to hear from the Minister of State on that question.

This agreement has elements that need to and should be improved on before it is signed off on. I thank the Minister of State and his officials for the detailed briefing note and the replies to queries that were raised at the finance committee, but in some ways these lead to further questions. For example, the note we got tells us that the negotiation began at Ghana's request, something the Minister of State has repeated here today. It has been suggested to me, however, that this is not quite the full story. We know in fact from documents that have been released that the Irish ambassador to Nigeria and Ghana approached the Ghanaians during the week commencing 2 July 2012 to propose treaty negotiations after it was set as "a deliverable" by the Department of Foreign Affairs and Trade. There is an issue here. It is not the biggest issue, but there are obviously two versions of a story that needs to be clarified.

The important thing, however, is the content, and I welcome the clarification that Ireland has contacted Ghana's competent authorities proposing a bilateral protocol to the treaty if that is Ghana's preferred way to implement the anti-avoidance BEPS measures. In July 2018, as the Minister of State mentioned, Ghana's competent authorities replied to Ireland stating they were considering the best way forward for Ghana on this matter. This is not a one-sided conversation or discussion, however; it is an agreement before us between two sovereign partners. We need to hold ourselves up to high standards, and to me it is not clear why the BEPS anti-avoidance measures, which the Government says the OECD finalised in December 2016, could not have been included in this treaty with Ghana, which was not actually signed by either of the parties until February 2018. The OECD process, as the Minister of State mentioned in his speech, was ongoing at that point but the signature of this treaty came two years later, after the OECD BEPS process had finalised in December of that period. Furthermore, why is the Oireachtas being asked to ratify a treaty now if it is going to change in the immediate future?

This agreement brings up some broader questions as to how we make double taxation agreements, and I have raised this at committee a number of times, especially how we do double taxation treaties with developing countries. The OECD rules are a huge improvement, as was discussed earlier, but the OECD is a rich man's club - let us be clear about that - and the UN model for tax arrangements should be what we use as a rule. The Minister of State's note downplayed the importance of the reduced rates of source country taxation. In effect, these are the rates such as for withholding tax and royalties which would only be 8% for Ghana, whereas Ireland charges 20% as a general withholding tax. I am conscious in all of this discussion that the Ghanian people are independent and sovereign and have negotiated this agreement, as the Minister of State said. My hope is that by the time this agreement is ratified in full in the finance Bill, all sides will have implemented the most up-to-date anti-abuse rules. They should have been included before this was signed off on by the State.

Finally, will the Minister clarify the scope that will be in the finance Bill to deal with either this treaty or the previous motion we discussed?

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