Bernard Durkan (Kildare North, Fine Gael)
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212. To ask the Minister for Finance the reason some institutions based outside Ireland but within the EU persist in referring to this jurisdiction as a tax haven; the action he can take to address and rebut such an allegation; and if he will make a statement on the matter. [45158/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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Measured by any objective international criterion, Ireland cannot be defined as a tax haven.

Ireland’s corporate tax policy, and broader industrial strategy, has consistently focused on attracting real and substantive investment that brings jobs. Our competitive but fair corporation tax rate is just one small part of the story. This complements our highly educated workforce, making Ireland an attractive EU base for businesses.

I am aware of a recent publication carried out by a research laboratory which has referred to seventeen jurisdictions, including Ireland, as tax havens used by European banks. I do not accept the label attributed to Ireland and would question the unique methodology used to arrive at this position.

The paper indicates that the identification of countries in the tax haven list relies on two parameters. Firstly, country-specific profit per employee of the banks in question with a focus on jurisdictions with high profit per employee. Secondly, a country-specific effective tax rate is used, to measure the tax rate applied on profits. An arbitrary 20% of countries with highest profits per employee is coupled with an arbitrary effective tax rate of lower than 15%.

Given our headline rate of corporation tax is a low but substantial rate of 12.5% it would appear to make Ireland, or indeed anyone with a rate of 15% or below, the target of such an arbitrary list of tax havens.

I believe that small countries, and Ireland is one of them, need to be able to use tax policy as a legitimate lever to compensate for advantages of scale, location, resources, industrial heritage and the real, material and persistent advantage enjoyed by larger countries.

Bernard Durkan (Kildare North, Fine Gael)
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213. To ask the Minister for Finance if he remains satisfied that Ireland’s political disadvantage on the periphery of Europe does not emerge in the future in the form of a disadvantage resulting in lack of confidence or lack of inward investment; and if he will make a statement on the matter. [45159/21]

Bernard Durkan (Kildare North, Fine Gael)
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214. To ask the Minister for Finance his views on the way the economy is progressing and is comparable to other EU economies; and if he will make a statement on the matter. [45160/21]

Bernard Durkan (Kildare North, Fine Gael)
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228. To ask the Minister for Finance the extent to which he remains satisfied with Ireland’s ability to compete with any new competitors which might pose a threat to Ireland’s economic viability; and if he will make a statement on the matter. [45266/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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I propose to take Questions Nos. 213, 214 and 228 together.

Ireland’s economic recovery from the Covid-19 crisis is now underway. Strong growth in the domestic economy was recorded in the second quarter of this year and domestic economic activity surpassed its pre-pandemic level for the first time since the start of the crisis.

The global economy experienced the shock of the Covid-19 pandemic in a reasonably symmetric way and a strong but uneven recovery is now anticipated. As in Ireland, the improving health situation and continued easing of public health restrictions in the European Union has put EU economies back in motion. In July, the European Commission projected growth of 4.8 per cent for the EU in 2021. This is broadly in line with expectations for the domestic economic recovery.

The expected rebound in the EU and globally creates a supportive external environment for Ireland’s exports in the coming years. The multinational sector in Ireland proved resilient throughout the crisis and is expected to continue performing strongly into the future. The outlook for Irish indigenous exports is also brighter in light of strengthening global demand, although Brexit is expected to have a strong impact on indigenous exports from next year. The Irish modified current account, which strips out the effects of globalisation, is expected to remain in surplus in the medium term.

Ireland provides an attractive location for FDI, with our talented and flexible workforce, our hard-won reputation as a pro-enterprise jurisdiction, and our successful record as home for global business. Evidence such as the IDA’s FDI results for 2020 suggests that foreign companies continue to value our FDI strengths.

Despite the positive outlook, risks to the international recovery continue to exist. As a small open economy, Ireland is particularly exposed to these external risks and my Department continues to monitor them closely.