Senator Catherine Noone, Seanad spokesperson on European Affairs, today sounded a cautionary note as the OECD plans to implement a shared taxation governance structure around BEPS (Base Erosion and Profit Sharing) continues to develop. Senator Noone said: “While we all share common ground on agreeing that regulatory incompatibilities between nations and their taxation structures mean that companies can move their resources in such a way that their taxation is very low, I would have sincere concerns about the impact that a move by the OECD might have in relation to Ireland in particular”.
Senator Noone continued: “As such a small, open economy, action by the OECD and the G20, if ratified by them, might cause concern. The goal from the OECD’s perspective is that, once the process starts, it will be completed in two years. I, and a great many others, would have concerns that Ireland – if it takes part in this system which would see changes to domestic law, bilateral treaties or in some cases multilateral instruments – would give advantages to nations who opt out of the system, and I believe that we would need to see sufficient incentives to take part, or disincentives for those who don’t take part, in order for it to be useful in an Irish context”.
Senator Noone added: “We are seeing mobile, agile sectors – in particular technology – aiding our recovery and pulling us back up from where Fianna Fail left us in 2011. We have come far and worked hard, and I believe we now need to be looking out onto the horizon for both opportunities and challenges and – for me – the planned action around BEPS could represent a potential challenge. While I know that the Minister for Finance welcomes the overall goal of the action, as we all do, I would call on the Minister to ensure that we have adequate contingency plans in place to ensure we are prepared for all scenarios depending on which nations sign up to the plans that the OECD has”.