Dáil Éireann Debate, Wednesday - 3 March 2021
207. Deputy Cian O'Callaghan asked the Minister for Finance if he supports the legal implementation of public country-by-country reporting with regard to the proposed EU directive discussed at the Council of Ministers that aims to improve tax transparency and ensure the full disclosure of tax information by multinationals operating here; and if he will make a statement on the matter. [11716/21]
View answerIreland supports transparency and good governance for corporates including “country-by-country” reporting by MNEs to national tax authorities. The Finance Act 2015 introduced obligations for relevant companies to report to the Revenue Commissioners in line with agreements on tax transparency agreed as part of the OECD BEPS process.
The European Commission made a proposal in April 2016 for a Directive to amend Directive 2013/34/EU (the Accounting Directive) as regards disclosure of income tax information by certain undertakings and branches (country-by-country reporting). While Ireland is broadly in favour of tax transparency, we have opposed this proposal as the legal base is not in keeping with the Treaties and that as it relates to tax, it should be the responsibility of Finance Ministers to negotiate in the ECOFIN Council formation rather than at COMPET Council. Proposals on taxation at EU level, should be progressed on the correct legal basis to ensure that laws are legally robust and secure against any future challenges so that shared objectives for transparency and good governance are comprehensively realised. The principled position Ireland is taking is shared by a number of other Member States and indeed the Council Legal Service. Further, it is relevant that the Oireachtas adopted a Reasoned Opinion in June 2016 to the effect that this proposed Directive is a tax matter and does not meet the principle of subsidiarity.
Ireland has long been a supporter of, and a beneficiary of tax transparency. Ireland has continuously implemented the necessary measures to ensure we are up to date with international best practice on tax transparency and exchange of information negotiated at the OECD, as well as supporting the parallel EU efforts through agreement of the Directive on Administrative Cooperation in the field of taxation. This covers administrative cooperation between EU Member States on tax matters, and automatic exchange of tax rulings, financial account data as well as mandatory disclosure of cross-border tax arrangements. It should be noted that of the 78 jurisdictions reviewed to date by the Global Forum on Transparency and Exchange of Information for Tax Purposes, Ireland is one of only a small number of jurisdictions to have been found to be fully compliant with new international best practice.
Notwithstanding Ireland's views and those of other EU Member States and the Council Legal Service on the legal basis, this Proposal now has the necessary support to proceed from COMPET Council. Ireland will engage constructively in future negotiations on this Proposal.
