Joan Burton (Dublin West, Labour) | Oireachtas source

I have put forward a Private Members' Bill, which proposes that Ireland would have a minimum effective tax rate on corporation tax profits and that we would also have a standing commission to examine matters of taxation.

The Government is on notice, and I am sure the Minister is well aware of it himself, of a situation whereby global companies, whether financial companies, social media companies such as the FANG - Facebook, Apple, Netflix and Google - companies, cannot continue to operate on a global basis where, effectively, they contribute little or no taxation in different jurisdictions in which they both provide and sell their goods and services. It is not reasonable to expect that we become perceived as some kind of global centre for an unacceptable form of tax mitigation and avoidance.

I have a later amendment asking that, in a similar way, the Minister would make provision for a report in respect of digital taxation because now, and in the recent UK budget, even the Tories, from the heart of the city of London, proposed a digital tax commencing in 2020. This is intimately related to any review because we are talking about people making excessive profits. I am sure many of the Minister's economic heroes, from Adam Smith on, would look favourably at returns and taxation which are fair and do not have the distorting influences on economic activity of the extreme position that is now shown to prevail.

We need a response from the Minister. I am sure it will be thoughtful.

The Minister might say that the 12.5% rate is not the lowest tax rate in Europe but we know that. He might say that the rate has been a bedrock of the Irish offering in respect of foreign direct investment, but it is not being applied in the case of these companies. If the Minister were to say that, notwithstanding investment into assets of different kinds and the write-offs they might generate, there would be a minimum effective rate of 6.5% or 7%, that would at least mean that these companies were paying something. At the moment they effectively choose the figure and they are choosing to pay pretty much nothing. Ireland is just drinking in the last chance saloon in respect of these kinds of tax breaks.

There are also many correlative adjustments. The Minister and his officials were obliging in supplying me with the figures, which are big. In respect of many of the FANG companies,, national and regional jurisdictions in countries such as Italy are saying that the companies must either pay some tax on what they are selling and the profits they are making in the country or they must provide for a location in the country. That is happening increasingly in different parts of Europe and even in different parts of the United States. Does the Minister have a strategy to address this at all or is he just going to pull down the entire deck of cards? What is happening with many of these companies has become economically absurd. Not even the most right-wing economist in the canons of economics would defend it.

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