Global minimum corporation tax
Deputy Murphy criticised Ireland's tax-haven status and argued for stronger action on corporate tax. The Tánaiste defended the low rate as part of why Ireland attracts substantial corporation tax receipts.
I join in thanking all the staff for all the work that has been done over the past seven months in very difficult circumstances.
For years, People Before Profit has called for an end to Ireland's tax haven status. We have pointed out that not only is it immoral but it is completely unsustainable. The Government has continually responded over the years by saying that it cannot take action unilaterally and it cannot take action at a European level but it must be as part of a global process. We now have a global process to establish a 15% minimum corporation tax rate. In my opinion that is completely inadequate, but it is a global process. Where does the Irish Government find itself? It finds itself with Bermuda, the Cayman Islands and other tax havens in a small minority of countries opposed to it. Speaking on the radio this morning, the Minister, Deputy Donohoe, was fighting the corner for the 12.5% rate. Why should massive corporations pay taxes at a lower rate than that of workers?
Comment on this
I neglected to acknowledge the Labour Party for facilitating a pairing arrangement with Deputy Dillon. Deputy Dillon had a baby last week and I insisted that he take his two weeks paternity leave. I am grateful that the Labour Party is covering for that.
I point out to Deputy Paul Murphy that our low corporation profit tax rate is one of the reasons we receive so much in corporation profit tax.
We take in about €10 billion a year in corporation profit tax, which is roughly double what the average European country takes. Some people are seized by a high tax ideology, who believe that higher taxes always mean higher revenues. That is not always the case. This is an example of where lower taxes mean higher revenues, which we use to invest in health, education, welfare and other things. We do not want to jeopardise that.
What is going on is not just about tax justice or big companies paying their fair share of tax, which they should. It is also about big countries trying to get a bigger slice of the pie at the expense of smaller countries. The United Kingdom has negotiated a carve-out to protect the City of London and the US has negotiated a carve-out so that the EU drops the digital tax. We need to defend our position too.