Micheál Martin (Cork South Central, Fianna Fail)
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204. To ask the Minister for Finance his views on Ireland's corporation tax; and if he will make a statement on the matter. [35263/15]

Michael Noonan (Limerick City, Fine Gael)
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At 12.5%, Ireland has one of the most competitive headline corporate tax rates in the OECD.  This rate is applied to a broad base a policy which is endorsed by the likes of the OECD as it is good for growth in our economy.

Our competitive rate of corporation tax has been an important part of our industrial policy since the 1950s, and has attracted real and substantive operations to Ireland since then.

Last year the Department of Finance published the Economic Impact Assessment of Ireland's Corporation Tax Policy.  This contained the results of extensive research which was carried out and commissioned by the Department of Finance in 2014 which sought to quantify the effect of corporation tax policy on the Irish economy.

As part of this project, an independent organisation, the ESRI, were commissioned to carry out a study into the impact that the corporation tax rate has on the decision of firms to invest in Ireland.  This independent research found if the rate had been higher over the period of their sample then the number of new foreign investments into Ireland would have been lower.

Ireland is a leader in the areas of tax transparency and administrative cooperation, which are key to tackling the global problems of tax avoidance and aggressive tax planning.  The Global Forum on Transparency and Exchange of Information for Tax Purposes has rated Ireland as fully compliant with international best practice for the exchange of information, one of only 21 jurisdictions to get this top rating.  Most recently, we fully supported the European Commission's proposals to require the automatic exchange of information about tax rulings among Member States.

Ireland has not been and will never will be a brass-plate location.  We only have and want real substantive FDI, the kind that brings real jobs and investment into Ireland. 

In early October the OECD published the final reports on their project regarding Base Erosion and Profit Shifiting or BEPS.  I welcomed the publication of the final BEPS reports.  From the beginning, the key aim of the BEPS project has been to better align the right to tax with real economic substance and activity and, as such, the BEPS project is one which aligns with Ireland's own tax strategy.

Ireland has been a strong supporter of the BEPS project and I believe it is the best approach for dealing with aggressive tax planning. Ireland will now play an active part in the work to implement the BEPS recommendations globally.

The post-BEPS environment, which will see companies seek to better align the amount of tax that they pay with their substantive operations, will result in opportunities for Ireland.  The alignment of substance with a competitive rate of tax has long been the cornerstone of our corporation tax policy. 

The maintenance of the standard 12.5% rate of corporation tax is therefore extremely important for Ireland's economy.  Ireland, like other smaller member states, is geographically and historically a peripheral country in Europe.  A competitive corporate tax rate is a tool to address the economic limitations that come with being a peripheral country, as compared to larger core countries.  Ireland's 12.5% corporation tax rate plays an important role in attracting FDI to Ireland and thereby increasing employment here.

This evidence underpins the Irish Government's continued commitment to the 12.5% rate.