Written answers

Thursday, 17 May 2018

Photo of Peter BurkePeter Burke (Longford-Westmeath, Fine Gael)
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55. To ask the Minister for Finance his strategy in Europe regarding the proposal being advanced on the taxation of the digital economy; and if he will make a statement on the matter. [21787/18]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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In March the Commission published two proposed Directives in relation to the taxation of digital economy.

The first proposal is a ‘temporary’ solution of a 3% levy on turnover from certain digital service activities. The thresholds for application of a global turnover of €750 million and EU turnover of at least €50 million.

The second, "comprehensive solution" requires an overhaul of international taxation, establishing the concept of a "digital permanent establishment", allowing countries taxing rights over the business carried out by that entity in that country, even where the company has no physical presence in the country.

In respect of the Commission's proposals, discussions on the technical details are at a very early stage. Unanimity is required before any proposals can be agreed at EU level.

Ireland remains committed to global tax reform and believes that global solutions are needed to ensure tax is paid by companies where value is created. That is why Ireland has been a committed participant in, and strong supporter of, tax reform efforts led by the OECD through the BEPS process.

Ireland shares the view expressed in the recently published OECD Interim Report on the Digital Economy that further analysis is needed to achieve a globally agreed, evidence based solution, sustainable in the long run and focused on aligning taxing rights with the location of real substantive value creating activity.

Ireland will continue to actively engage with work in the area of the digital economy at both OECD and EU level.

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