Pearse Doherty (Donegal, Sinn Fein)
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106. To ask the Minister for Finance if Ireland's knowledge development box scheme is compatible with the EU's proposed common consolidated corporate tax base; and if he will make a statement on the matter. [32725/16]

Michael Noonan (Limerick City, Fine Gael)
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The European Commission's proposal for a Common Consolidated Corporate Tax Base was published on 25 October.  This is a Commission proposal which has not yet been discussed or considered by Member States.  The proposal will now be discussed by Member States and it is likely to be subject to significant reshape and renegotiation as these discussions progress.  These discussions are likely to go on for some time given the highly technical and complex nature of the proposals.  Ultimately, the unanimous agreement of all Member States will be needed before any common corporate tax base or any consolidated tax base could be introduced.  As these discussions have not even begun, it is impossible to state with any certainty at this time whether the Knowledge Development Box or any similar patent box incentives would ultimately be compatible with any common consolidated corporate tax base that is eventually agreed by all Member States.  What is certain is that the Knowledge Development Box is fully compliant with the internationally agreed rules for such incentives, namely the OECD "modified nexus".  These rules were agreed at the OECD as part of the Base Erosion and Profit Shifting (BEPS) project and have also been endorsed by all EU Member States through the EU Code of Conduct group.