Katherine Zappone (Independent) | Oireachtas source

I was recently given the honour of being nominated to the Parliamentary Assembly of the Council of Europe on behalf of the Dáil Technical Group and Independent Senators. While attending the assembly session in Strasbourg last week, I also had the opportunity to chair a legal affairs committee in Brussels. Ireland's leadership and presence is critical for our Presidency of the Council of the European Union. Having just returned from Europe, I wish to raise a matter for debate which is linked to our priorities for the Presidency. During the statements on the budget for 2013, I raised concerns about Ireland's corporate tax rate and its impact on developing countries as well as its impact on our own public services. There is a significant difference between the nominal rate of 12.5% and the effective rate that multinational corporations operating in Ireland actually pay. Due to the various tax breaks that are available to the multinationals, the effective tax rate, according to some sources, is only 5% or 6%. I know Members are aware that the Minister for Jobs, Enterprise and Innovation, Deputy Bruton, recently responded to this and countered it by saying that the effective rate is as high as 11.9%. Obviously there is some debate going on in terms of the research but locating a subsidiary in Ireland is, for many multinationals, a crucial part of their tax avoidance or, to use better language, tax minimisation schemes. Developing countries lose more to tax avoidance by multinationals than they receive in aid, with Christian Aid putting forward the figure as high as $160 billion per year. Our own public services are also affected, with SMEs contributing to the maintenance of the public services that sustain their businesses while multinationals avail of competitive advantages such as tax breaks and simply freeload off these services.

Such practices have recently come under scrutiny in France, as Members are aware, and at parliamentary hearings in the UK. One of the things to emerge from the hearings is that compliance with standards as laid down by the law or by the EU can result in unethical practices and unfair outcomes, as the Minister of State at the Department of Foreign Affairs and Trade, Deputy Joe Costello, recently admitted. In the Minister of State's view, the issue should be dealt with in Brussels.

In that context, I have a question for the Deputy Leader. The programme for Ireland's Presidency acknowledges that the EU provides more than half of global development assistance. Our programme also states that Ireland wants to ensure that the EU's financial assistance to developing countries is as effective as possible. I ask that we invite the Minister of State, Deputy Costello, to the House to debate the effectiveness of our development aid in light of our corporate tax rate.