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Decision to end ‘double Irish’ loophole ‘extremely smart’

Leading OECD official says Government decision sent out positive message internationally.

The announcement by Ireland that it is ending the so-called “double Irish” tax structure was perceived as “extremely smart”, a leading official from the Organisation for Economic Cooperation and Development has told a Dublin conference on corporate taxation.

The director of the OECD’s centre for tax policy and administration, Pascal Saint Amans, said Ireland has been an extremely constructive participant in the organisation’s base erosion and profit shifting project (Beps), which is looking to draft new rules for global taxation.

He said that while drafting the proposed measures has been very complicated, the really difficult bit will be seeing they are implemented after they have been finalised next year.

He said the reason it had become a prominent international issue was because it was recognised that greater and better regulation of the international rules was needed. Otherwise the misuse of the international rules would lead to national governments introducing protectionist measures.
Heinz Zourek, director of the European Commission’s DG taxation and customs union, said the debate within the union about a Common Consolidated Corporation Tax Base (CCCTB) may be revived.
The commission’s proposals on a CCCTB are not considered by Dublin to be in Ireland’s interest as our low corporation tax rate is seen as key to attracting foreign direct investment here.

Mr Zourek said the new commission president, Jean Claude Junker, is interested in reviving the idea, but that before work on the proposal could resume, a clear political signal would be required.

The commission’s state aid inquiries involving Ireland, Luxembourg and the Netherlands moved up the current affairs agenda, he said, in the wake of the “Luxleaks” revelations, which had “an avalanche of reaction”.

He said that in recent years there had been remarkable change in relation to the issue of international cooperation and debate on tax.
He referred to national sovereignty in relation to tax matters as a “holy grail of autonomy” but pointed out that are community-wide codes on the non-introduction of harmful tax practices.
A recent letter from the finance ministers of France, Germany and Italy outlined, he said, how in their view the landscape for taxation had changed at European level and there needed to be broader debate.

The conference is organised by the Institute of International and European Affairs in association with KPMG. It is supported by McCann Fitzgerald and the media partner for the conference is The Irish Times.

Article Source: http://tinyurl.com/kbwqb42

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