Pat Breen (Clare, Fine Gael)
Link to this: Individually | In context

Question 128: To ask the Minister for Foreign Affairs his views regarding the recent state of the union address by US President, Barrack Obama; the implications that a change in the US tax policy would have for US multinationals based here; and if he will make a statement on the matter. [7243/10]

Micheál Martin (Cork South Central, Fianna Fail)
Link to this: Individually | In context

President Obama gave a wide ranging State of the Union Address with a core focus on restoring the US economy. The address covered issues such as the need for innovation, the stabilisation of the financial system, tackling unemployment and addressing the Government deficit.

In his State of the Union Address, President Obama reiterated his commitment to end "tax breaks for companies that ship our jobs overseas". This was followed up by the publication on 1 February of the US Administration's budget proposals for 2011. As they did last year, these include several proposed changes to the US international corporate tax framework.

The proposals in this area, if implemented, could affect the overseas operations of all US multinational companies, including in Ireland. However, it is important to note that any such proposals, in order to take effect, would have to be legislated on by Congress.

The Embassy in Washington, in close coordination with the IDA and the Department of Finance, has been monitoring these issues closely since the time of the Presidential campaign. Over the last year, there has been engagement at every level on this issue. The Taoiseach and I used the opportunity of our visit to Washington last March to raise our concerns in this regard with President Obama and Secretary of State Clinton. The Tánaiste met with Treasury Secretary Geithner last year to follow up on these discussions.

The Embassy in Washington has also been liaising actively with the US business community which has itself been engaging intensively in Congress on these proposals. Through this comprehensive programme of outreach with contacts in the Administration and Congress, the Department of Foreign Affairs, in coordination with the Department of Finance and IDA, aims to ensure that the mutual benefits of our existing relationships with the U.S. and U.S. companies in Ireland are fully understood and that this feeds into consideration of this issue by the Administration and Congress.

In our engagements in the US over the St Patrick's Day period, the Taoiseach and I will be emphasising the strong economic relationship between Ireland and the US which provides vital trade and business opportunities for both countries.