Bernard Durkan (Kildare North, Fine Gael)
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109. To ask the Minister for Finance the extent to which he remains satisfied that Ireland's 12.5% corporation profits tax remains intact in view of its importance to the economy particularly post Brexit and the difficulty posed by being an island off the coast of Europe with consequent extra cost in getting to the centre of the market; and if he will make a statement on the matter. [4303/18]

Bernard Durkan (Kildare North, Fine Gael)
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176. To ask the Minister for Finance the extent to which he expects Ireland's 12.5 % corporation profits tax to remain in place, notwithstanding efforts to bring about its cessation. [4637/18]

Bernard Durkan (Kildare North, Fine Gael)
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177. To ask the Minister for Finance the extent to which he expects to retain incentives to encourage foreign direct investment in the future; and if he will make a statement on the matter. [4638/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 109, 176 and 177 together.

Ireland’s corporation tax regime is a core part of our economic policy mix and is a longstanding anchor of our offering on foreign direct investment (‘FDI’).

At 12.5%, Ireland has one of the most competitive headline corporate tax rate 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 corporation tax regime has been an important part of our industrial policy since the 1950s, and has attracted real and substantive operations to Ireland since then.  We only have and want real substantive FDI, the kind that brings real jobs and investment into Ireland. 

In 2014 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 which sought to quantify the effect of corporation tax policy on the Irish economy.

 As part of this project, an independent organisation (the Economic and Social Research Institute (‘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.

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.

Tommy Broughan (Dublin Bay North, Independent)
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110. To ask the Minister for Finance his views on the latest proposals by the EU on taxation of the digital industries within the European Union and its impact on corporation tax receipts here in the future; and if he will make a statement on the matter. [3995/18]

Paschal Donohoe (Dublin Central, Fine Gael)
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The European Commission is expected to announce proposed Directives on digital taxation before the end of March this year.  It is expected that the proposals will include short term and long term suggestions for how digital companies should be taxed within the EU.  

When these proposals are published, they will then be debated in detail by Member States.  It is likely that the proposals will be amended as the debate on them progresses.  Ultimately unanimity between all Member States will be needed if any proposal is to be agreed and there is no guarantee that anything will ultimately be agreed.  I have been clear in my view that if action is to be taken in this area, its needs to be agreed at global level, needs to focus on ensuring tax is paid where value is created and must not simply represent a redistribution of tax to large Member States with bigger populations and markets. 

Ireland will constructively engage with the proposals, while assessing whether they are in our long term interests.  Given that we have not seen the detail of any proposals, it is not possible at this time to analyse the potential impact of the eventual proposals on corporation tax receipts in Ireland.