Dáil Éireann Debate, Thursday - 14 October 2004
45 Mr. Gogarty asked the Minister for Finance his views on the decision by the EU Council of Finance Ministers to investigate the way corporation tax can be harmonised throughout the European Union. [24801/04]
View answerLast July the Commission published two papers on company taxation. One paper seeks an indication of the degree of support for a proposal to start developing a common corporate EU tax base while the other seeks to assess the degree of support for the Commission's proposed pilot project on home state taxation for small and medium sized enterprises.
On 11 September the papers were discussed at an informal ECOFIN meeting. Some member states, including Ireland, opposed the idea. However, a large majority supported the creation of a working group, chaired by the European Commission, to consider the idea of allowing all companies to use a common consolidated set of rules for calculating their EU wide taxable profits. The group will also consider a pilot project that would allow SMEs to use the tax rules of their home state for calculating their EU wide taxable profits.
The Commission considers that efforts should be concentrated on developing a common consolidated tax base, thereby reducing the compliance burden of companies. Commissioner Bolkestein, the outgoing Commissioner for the Internal Market and Taxation, stated that wholesale harmonisation of the tax system is not on the Commission's agenda.
Ireland's position is consistent and will continue to be clearly articulated. We support efforts to eliminate unfair business tax practices within the EU and the removal of barriers to cross-border trade and business. We are opposed to the Commission's proposals for a common consolidated base. All efforts are best spent in tackling specific issues identified as barriers to trade. In any technical discussions on a common consolidated tax base, Ireland will be seeking to protect its interests.
Ireland is also opposed to the harmonisation of corporation tax rates. It is important that the tax rights of member states are retained at national level.
