Dáil Éireann díospóireacht -
Wednesday, 15 Jun 2016

Vol. 913 No. 2

Report of Standing Order 112 Select Committee on the Proposal for a Council Directive amending Directive 2013/34/EU: Motion

Deputy Colm Brophy

I move:

"That Dáil Éireann:

(1) notes the agreed Report of the Standing Order 112 Select Committee under Standing Order 114 on the Proposal for a Directive of the European Parliament and of the Council amending Directive 2013/34/EU as regards disclosure of income tax information by certain undertakings and branches, COM(2016)198, which was laid before Dáil Éireann on 9th June, 2016 in accordance with Standing Order 114(3)(b);

(2) having regard to the aforementioned Report, and in exercise of its functions under section 7(3) of the European Union Act 2009, is of the opinion that COM(2016)198, Proposal for a Directive of the European Parliament and of the Council amending Directive 2013/34/EU as regards disclosure of income tax information by certain undertakings and branches, does not comply with the principle of subsidiarity for the reasons set out in paragraph 3 of the Report; and

(3) notes that, pursuant to Standing Order 114(3)(d), a copy of this Resolution together with the aforementioned Report shall be sent to the Presidents of the European Parliament, the Council and the Commission."

As chairperson of the select committee, I am pleased, on its behalf, to move the motion for a reasoned opinion on the proposal for a directive of the European Parliament and of the Council amending Directive 2013/34/EU as regards disclosure of income tax information by certain undertakings and branches.

The Lisbon treaty provides important power for national parliaments in the EU legislative process. Under its provisions, national parliaments have a right to object to EU draft laws in the form of a reasoned opinion. National parliaments must consider whether proposed new legislation complies with the principle of subsidiarity. This power must be used by national parliaments within eight weeks of the publication of proposed new EU legislation. The eight week deadline for this falls today.

In the EU context, subsidiarity is a concept about the level of governance at which an action should be taken. It is based on the presumption that the action should be taken at the lowest level of governance consistent with the subject matter and the objective to be attained. The procedure set out in the Lisbon treaty is that if one third of national parliaments send reasoned opinions indicating that a proposal does not comply with the principle of subsidiarity, the draft directive must be reviewed by the European Commission. The Commission can then decide to maintain, amend or withdraw the directive and must give reasons for its decision. Although this threshold is unlikely to be reached in this case, the committee is still of the belief that it is important for this Parliament to strongly express its view and to do so through a reasoned opinion.

With regard to the background to this, the Dáil ordered the establishment of the Standing Order 112 Select Committee on 10 March. This was done to ensure that the Dáil had a voice on EU legislative matters. The committee was given responsibility to carry out the parliamentary functions associated with the Lisbon treaty. The committee first considered this proposal for a directive on 11 May and decided that the proposal needed detailed scrutiny. The committee sought and received submissions from stakeholders and these were considered on 1 June. The committee discussed the proposal for a third time in public session on 8 June with assistance from the Department of Jobs, Enterprise and Innovation. That Department conducted a public consultation which closed on 20 May. The committee was briefed on the summary results of this consultation. The committee sought submissions from a number of stakeholders ranging from Christian Aid to the Irish Tax Institute. In general, the same issues and concerns were raised in those submissions. Following this meeting of the committee, it was agreed that a reasoned opinion was justified in this case.

On 9 June the committee met again and agreed the report that is now being debated. The report sets out the grounds for the Dáil to send a reasoned opinion to the EU institutions. As is clear from the committee's engagement, the decision to bring this matter to the House was not taken lightly. I understand this will be only the fifth time the Dáil has considered the adoption of a reasoned opinion under the treaty.

The Commission's proposal in this case supplements a recently adopted directive on administrative co-operation which already obliges large multinationals to report taxes paid on a country-by-country basis to tax authorities and also provides for those authorities to share that information with each other. The Commission hopes that the publication of some of this information will allow public scrutiny of corporate tax arrangements. I believe it is fair to say that the committee is very supportive of this objective of the Commission and it made that view clear.

The Commission proposal, if passed, will apply to multinational companies, European or not, which are based or have a subsidiary or branch in the EU, where they have a consolidated turnover of €750 million. It appears that somewhere between 47 and 95 companies with Irish based parents will fall within the scope of the proposal. Under the proposal, companies will be obliged to prepare a report that sets out the corporation tax that a multinational pays in each EU member state and where it operates. This is commonly referred to as country-by-country reporting. The same information must be provided for each non-co-operative tax jurisdiction in which the multinationals are active and, for the rest of the world, multinationals need only prepare or give an aggregate for all corporation tax paid. The proposal also provides that the Commission will prepare a list of non-co-operative tax jurisdictions. This will be done by delegated act, in consultation with the European Parliament and member states. This element of the proposal was developed by the Commission at a late stage in the drafting and was not part of the impact assessment.

The committee's view is that any assessment of the tax status of countries is one for members states' own tax authorities and Finance Ministers, based on tax principles. EU Ministers for Finance have recently agreed to prepare a similar list for tax purposes.

Having considered the proposal in great detail, and it is important to note the committee considered it in the context of subsidiarity, the committee agreed that issues of concern arise in terms of the principle of subsidiarity. I will summarise briefly the reasons the committee came to this conclusion. The committee is of the opinion that the proposal relates to tax policy rather than accounting practices, as tax policy is clearly a competency of member states, a breach of the principle of subsidiarity has therefore occurred on that basis. The committee also found that the Commission had failed to show that it is better placed than member states to develop a list of tax havens. On this basis the committee concluded that this action is a breach of the principle of subsidiarity.

Accordingly, I commend the committee's draft reasoned opinion that the proposed directive does not comply with the principle of subsidiarity as set out in the Lisbon treaty. If this draft reasoned opinion is agreed by the Dáil, it will constitute the House's formal response under the Lisbon treaty.

Acting Chairman (Deputy Eugene Murphy)

I point out to Members that the total amount of time allocated for this debate is 40 minutes and that includes Deputy Brophy's five minutes contribution. Each of the various groups will have five minutes to make their case. The next speaker is Deputy Fleming.

Deputy Sean Fleming

I welcome the opportunity to speak on the motion on this EU proposal. Essentially, we need to set out, in layman's language, what the proposal contains. Under this EU proposal, it is proposed that companies with revenues in excess of a turnover of €750 million will be obliged to publicly disclose financial information for each country within the EU with which they do business. In addition to that, they will be asked to supply information regarding their turnover, taxes paid, profit before tax, number of employees, the nature of their activities and accumulated earnings. On the face of it, I believe some people would say that is a good idea.

The problem with the way the EU has gone about bringing forward this proposal is that it has introduced it under a company law directive, but essentially the proposal before us is about taxation. The EU was disingenuous in introducing a taxation measure, trying to slip it in under a company law directive. That is essentially the reason our committee, on which I served with the chairman, has a problem with this. If the EU has said this is a taxation proposal and that it would put it through the relevant finance committees, it could have been debated for what it is but it tried to slip it in under a different heading. That was a sneaky move on its part and it deserves to be pulled up on it. It is also damaging to the EU and it is no wonder the people in England have a problem with the EU when this is how it goes about its business.

We discussed at the committee the fact that 6,000 companies across the EU could be affected by this proposal but it said that in Ireland up to 47 companies could be affected. We asked the Department of Jobs, Enterprise and Innovation how many of those 47 companies are indigenous companies such as Kerry Co-Op, Cement Roadstone and Glanbia, but it was not able to provide that figure. It said that neither Revenue nor the Central Statistics Office could give us the information and it referred us to The Sunday Times top 1,000 companies. That was the publication to which the Department referred the committee yesterday for us to establish how this proposal would affect Irish companies. All the members of our committee received that e-mail referring us to the top 1,000 companies in The Sunday Times supplement. They might have a look at that. It was the official response from the Department and was wholly inadequate. I am not criticising the Department exclusively for the problem here as the problem emanated with the EU.

Many people would say we need to increase taxation co-operation across EU level and to close off some of the loopholes referred to in regard to non-co-operative tax jurisdictions.

To the rest of us, that is a tax haven. In European language, however, it is called a non-co-operative tax jurisdiction. They do not specify who decides who should be on this list, whether the list can change from country to country or whether one will be on it next year if one is on it this year. It is a badly thought out proposal on the part of the EU and an attempt to sneak it in under company law. Somebody in that section has an agenda in regard to taxation and should have been upfront that this was a taxation proposal. In that case, we would have dealt with it under the base erosion and profit sharing proposals being discussed at European level so that there can be harmonisation in regard to these taxation measures. However, they chose to go the opposite way because they know the Commission does not have competence to set taxation rates or interfere with taxation in regard to corporate or personal taxation rates in any of the EU member states. They decided to call it an accounting directive and slip a taxation measure in through the back door. They have been caught out on that.

Already, our friends in Sweden, whom we met the other night, have issued a similar direction to the EU to the one we propose to approve this evening. Tonight is the last date for the Parliament to respond. I support the proposal that we should send an opinion to the EU to the effect that it is not within the competence of the EU to do this under the directive and if it wants to reconsider and come back to it properly at a later date, that is another day's work. They should not be doing it here now. I have grave concerns about the fact that we do not know what impact this will have on indigenous Irish business and, indeed, they have not even attempted to specify it.

I revert to the comment I made a few minutes ago. It is no wonder that there is a referendum on Brexit in the UK. I have no idea if they will even have time to discuss it this week, but if people in Britain saw that this proposal was before the House of Commons, it would greatly help the Leave campaign if they saw what Europe was at behind their backs. I say to the eurocrats at the Commission who dream up these things, it is not for the good of the EU that they go about their business in this way. It harms the EU to go about business in this back-handed way. Thank God, there are alert committees in our Parliament and in the Swedish Parliament that can see what is going on. We are calling a halt and saying they do not have the authority to do this. They must go away and redraft.

Acting Chairman (Deputy Eugene Murphy)

I always knew Laois people were ringers for time. The Deputy is spot on.

Deputy Pearse Doherty

I congratulate the conservative establishment on retaining the ability to shock me. Today's motion is a new level in hypocrisy. The EU Commission's proposal is a very modest attempt to bring more transparency to the tax affairs of very large companies. This State brought in country-by-country reporting in last year's Finance Bill but failed to make this reporting publicly available. The Commission's action would make that reporting public in the case of very large companies. Due to the austerity rules for which Fine Gael, Labour and Fianna Fáil argued, we are struggling to find special purpose vehicles to build homes for our friends and families, relying on strokes of luck from EUROSTAT to allow us keep our hospitals working to full capacity while the Taoiseach is writing begging letters to the EU to be allowed build the infrastructure every business in the country is crying out for. However, when it came to those rules, all parties in the State, bar a few, were willing to roll over. Suddenly, however, and because 47 huge companies will be asked to be a tiny bit more transparent about their taxes, we have a problem. This is hypocrisy on a huge scale and it will fool nobody.

There is no party that has even the merest bit of credibility when it comes to protecting Irish sovereignty here compared to Sinn Féin. We engage critically with the EU and are proud to have stood for Irish sovereignty time after time. When our fishermen's and farmers' livelihoods, our natural resources or our neutrality are in question, there are no concerns about sovereignty from the parties that have swallowed the EU line time after time. This motion is not about subsidiarity, it is about protecting huge companies from having to put some of their tax affairs in the open. Only months ago, I proposed in the Finance Bill that Ireland introduce country-by-country reporting on a public basis. I was told we should wait because the EU and OECD were moving in that direction. Now that these bodies have done exactly what I was told to wait for, we are raising objections.

The legal arguments put forward by the committee are weak. This is an accounting action, not primarily a tax proposal. No tax rate changes as suggested by Fianna Fáil are proposed. The use of the quote from the Commission referring to "tax policies and administration" in the report is a distortion. What it actually said was:

In an increasingly global integrated and digitalised economy, corporations and production value chains reflect less national and indeed regional boundaries. By contrast, tax policies and administration remain primarily a national responsibility.

That is what is in it. It is not this idea of a grab for tax control. The attempt at spin here can be seen through without much effort. The proposal is clearly referring to financial reporting in the context of cross-border abuses not tax affairs. Likewise the attempt to present the proposal to set up a blacklist as a power grab is politically motivated not legally motivated. We have to ask whether Ireland and so many other states are nervous about who might end up on such a list. I disagree strongly that the proposal in Article 28 exceeds the power given to the EU and see nothing in the report that makes me think otherwise. Scare-mongering around American reaction to this initiative can also be dismissed. It would be our preference that moves like this be made on a global rather than an EU scale, but until that time there is no excuse to not go with the progress that can be made.

When it comes to cracking down on tax avoidance, the State is treading a fine line. Time after time, it has called for international co-operation and a cynic might say that was a delaying tactic. When the international co-operation happens and an EU proposal for the implementation of internationally agreed standards on financial reporting comes before us, the establishment political parties start to wave a yellow flag, shouting about subsidiarity and sovereignty. It is not credible. It is time for real debate in this country about our relationship to the international tax system. How many times was I told we could not act to end companies declaring themselves stateless or that we could not close the double Irish and had to wait for our international partners to move? Yet, it happened and we were able to do it. Development charities have correctly pointed out the real impact of facilitating tax avoidance. They have made practical suggestions as to what the State can do domestically to be a fairer player in international tax matters. I hope the Government will move on this issue.

Sinn Féin rejects this motion. It is a political attempt to hide behind an honourable concept. Fundamentally, this is not about Ireland's interest or the interests of Irish workers; it is about protecting the interests of 47 massive companies, which will survive in any event.

Deputy Joan Burton

As we have heard from Deputies Fleming and Brophy, the all-party committee argues that the proposal offends against the principal of subsidiarity. With respect, I do not see how it does so. Subsidiarity is defined such that in areas which do not fall within its exclusive competence, the Union can act only if and in so far as the objectives of the proposed action cannot be sufficiently achieved by the member states either at central level or at regional and local level but can rather, by reason of the scale or effects of the proposed action, be better achieved at Union level. I would have thought it was clear that this is a matter where agreed objectives cannot be achieved by the member states acting alone and where EU action is, therefore, needed.

I note that the committee is supportive of measures encouraging greater corporate social responsibility generally, including measures providing for fair and transparent accounting and reporting arrangements by large corporations. That position is welcome. The only argument that this is a tax measure rather than an accounting measure is in the committee's questioning of the use of an amendment to the accounting directive as the appropriate means of achieving its objective in this case. To note the fact that an accounting directive is proposed to be amended is to miss the point.

The legal basis for this proposal, as stated by the Commission, is Article 50 of the Treaty on the Functioning of the European Union, which relates to the right of establishment and the setting out by directive of harmonised conditions for the exercise of that right or rights. I agree with the Commission that, in an increasingly global and integrated economy, enterprises can easily relocate their tax bases from one jurisdiction to another within or outside of the Union. The EU's action is justified in order to address the cross-border dimension where there is aggressive tax planning or transfer pricing arrangements.

There is a growing international consensus about the need for greater tax transparency. This proposed directive aims to enhance transparency and public scrutiny of corporate income tax by adapting the existing legal framework concerning the obligations imposed on companies and firms in respect of annual reports. It clearly does not concern the harmonisation of taxes, only obligations to publish reports on income tax information. I have been a strong supporter of the base erosion and profit shifting, BEPS, process, although achieving sufficient progress in that regard has been slow and difficult. The Panama papers have disclosed extraordinary levels of aggressive tax evasion, avoidance or whatever one wants to call it. In many countries, the tax bases are increasingly being eroded. The committee received a detailed submission from Christian Aid setting out the consequences of this, particularly for developing countries. Unless we develop the collective will to publish a relatively modest amount of additional information in annual reports and such like, it is difficult to see how there could be any level of accountability on the part of what are, by any standard across the Union, very large enterprises. This situation can only be progressed if countries act together. We need to consider people's best interests globally in this respect. When we do, we will see the answer. If everyone has a mé féin, beggar my neighbour attitude, we will find it almost impossible to make progress on BEPS or any other element that seeks to bring additional transparency to what some large multinational corporations are aggressively doing, according to the limited information contained in the Panama papers, to avoid making any tax payment in almost every jurisdiction on what are by global standards extraordinary profits.

Acting Chairman (Deputy Eugene Murphy)

I must ask the Deputy to conclude.

Deputy Joan Burton

That is to the detriment of small and medium-sized companies in almost every country.

Deputy Richard Boyd Barrett

This motion is part of an ongoing and systematic cover-up, one involving the Fine Gael, Fianna Fáil and others in the House, of the country's collusion with aggressive and large-scale corporate tax avoidance by the largest and most profitable multinationals in the world operating in Europe, including this country. It is extraordinary that the only reason we are even debating this motion now is because I telephoned the Chief Whip's office yesterday morning to ask why there was to be no debate on this measure, an EU proposal, demanding country-by-country public reporting of the profits and affairs of the wealthiest multinationals. It is extraordinary that even some of those who have spoken against the Government motion are members of the committee that agreed it. Where was the dissent on this matter at the committee? It would have allowed the motion to pass yesterday without any debate on what constituted a minimal effort to require country-by-country transparent reporting and a blacklist of tax havens, which are correct and long-overdue measures. They do not go far enough, but at least they are moving in the right direction.

Incredibly, the Government, Fianna Fáil and whoever else was on the committee went along with the idea that this measure should be blocked on the spurious grounds of subsidiarity, the rubbish notion that it transgresses into the area of tax policy. It is purely an accounting measure, one that requires multinationals operating across national borders to say where their profits are being generated. This is not a tax policy or tax measure. It simply addresses the deliberate and systematic hiding and shifting of profits by multinationals that are involved in staggeringly obscene tax evasions and in robbing the taxpayers of this country of tens of billions of euro and the taxpayers of the world of hundreds of billions of euro every year. When one asks why we have a housing crisis, a health crisis or growing poverty and inequality, the answer is that the wealthiest multinationals in the world do not believe in paying taxes, pay accountants to avoid paying them systematically and have certain governments, including ours, in their pockets to ensure that they get away with tax avoidance.

This is happening belatedly and under pressure from the people, not the European Commission. People were angry at what happened in the recession, including the austerity and culpability of large corporate entities for it. They have demanded that there be some transparency and action in order to deal with corporate tax avoidance by the multinationals. In public statements, the Irish political establishment has claimed to be in favour of these measures but at its first opportunity to implement measures that would shine a light on the multinationals' massive systematic tax avoidance, it has moved to block them, cover up the situation and prevent a debate in the House. Similarly, the cameras at the finance committee were turned off for our discussion on whether to have Apple attend to explain its tax affairs in this country. That is the level of the collusion by the political establishment.

The media is asleep at the wheel. This is the most important topic that has been discussed in the Dáil this week, yet it is the shortest debate. We would not even have had a debate but for the fact that we raised the matter. We are discussing billions of euro, yet there was not even going to be a debate. The establishment will now close ranks and push this through on a technicality in order to block a reform measure on what is the most important of areas.

There is a direct correlation between poverty, unemployment, the crisis in our public services and growing inequality globally, and the ongoing practice of multinationals in this matter. The Irish political establishment has closed ranks, shut down debate, covered up the situation and colluded with people. It is outrageous. Thanks to the oversight of the left in this country, some alarm bells are being rung about the issue, there will be a vote and there has been some debate, albeit a ridiculously short-circuited one.

Deputy Clare Daly

I acknowledge Deputy Boyd Barrett's role in forcing what is a limited discussion, but at least the issue is being partially aired. I agree with his points, in that it is an indictment of our Chamber that this could have happened without any discussion on these serious proposals. We are debating the European Commission's latest attempt to introduce greater transparency in the reporting of multinational corporations. As we have heard, the committee asserts that the proposal does not comply with the principle of subsidiarity, which is utter rubbish and would not stand up to any scrutiny whatsoever.

It has been exposed, even by the arguments that have been heard in the House, as a veiled excuse to cover what are in reality very minor baby steps towards delivering some sort of tax transparency and tax justice.

These are enormous issues with considerable implications in Ireland and internationally. I agree with the submissions made by organisations such as Christian Aid stating the proposals do not go far enough. It was ironic to listen to organisations such as IBEC stating they go too far. It even stated the proposals add to what it calls the growing view that the EU is a hostile environment for multinationals. Seriously, it does not need to worry about that at all.

If one were drawing on the subsidiarity argument to give oneself more power to argue that these measures should go further, it would make some sense. That the opposite argument is being made is frightening and regrettable. As Christian Aid has said, it is very difficult to see how these modest proposals will do anything to help developing countries and prevent multinational corporations from shifting their vast profits out of them to avoid paying tax that could be spent on essential services and fulfilling citizens’ rights in those countries. It is a matter of fact that developing countries suffer most as a consequence of corporate tax dodging. Even the IMF has said tax dodging is worth $200 billion annually. This is a staggering figure. This sum could transform the lives of people.

What the proposals describe as "country-by-country reporting" really cannot be called that. It is not actually true because they do not cover every country in which a company might operate. Companies with subsidiaries outside the European Union and those on the list of tax jurisdictions yet to be defined as non-co-operative, namely, the tax havens, will be required only to report on an aggregate basis. That is a fundamental flaw or weakness in the proposal. Placing together jurisdictions to where the profit is likely to be shifted, particularly developing countries and so on, negates the entire point of country-by-country reporting. The policy should have been to shed light on these issues. However, if aggregate reporting is allowed, no light is shed on them.

Another key flaw is that the threshold of reporting is set at €750 million. This is way too high and really means that approximately 90% of multinationals will be excluded from the proposal in any case. Therefore, it is an incredibly modest proposal. There are problems with it in that it does not have the ability to deliver sufficient tax transparency or combat the tax dodging that is crucifying developing countries.

The contributions from the Government today seem to indicate it is bending the knee to those who would like to see a pretty precarious or dodgy tax-havenish status continue. PricewaterhouseCoopers was very interesting when it referred to the need for enterprises to consider carefully their response to future transparency, particularly country-by-country reporting and the way it reflects on the allocation of results across the value chain. No doubt, PricewaterhouseCoopers will be available to advise.

When we talk about tax avoidance in Ireland, we tend to focus on multinational corporations. I acknowledge the disgusting role of organisations such as PricewaterhouseCoopers, KPMG, EY and Deloitte, which operate on the basis of being one step ahead in facilitating the multinationals in avoiding tax at every turn. Their large headquarters are here not because they like the weather or because they are doing the accounts for the newsagent but because they want to facilitate the continuance of what has prevailed here. It is disgusting. To try to make us special in Europe for these reasons is abhorrent when we do not achieve this by being best-case advocates for refugees, for example.

Deputy Mattie McGrath

I, too, am glad to speak on this motion. I compliment the special committee that brought this matter to our attention. Deputy Boyd Barrett said this was to go through without any debate. It is always important that we have a debate, no matter what our views are. It is important that we do not pass these measures without debate. I compliment the committee on not rolling over and accepting what was proposed in this instance. As with previous speakers, I believe this is too serious an issue. Many of our indigenous companies are now multinationals. Included in this regard are Kerry Group, Glanbia and numerous others, which are employing thousands of people. All the time, we must be mindful of where they started. They started small. Tosach maith, leath na hoibre. Many of these companies are flagship companies, including in our agrifood industry.

In this case, there should be total transparency with regard to accounting and accounting methods of all these companies. I hasten to add, however, that we should not throw the baby out with the bath water. In Clonmel in my constituency and Dungarvan in the neighbouring constituency, there has been considerable foreign direct investment. Multinationals are providing considerable employment and supporting ancillary services and the service industry. These multinationals are huge and many have been here for decades. Predecessors of mine and others, including officials in the county councils, IDA Ireland and Enterprise Ireland, worked very hard to bring them here. We must have a reasonable, reflective and balanced debate because we do not want to hunt all the companies out of our country. If we are all poor, we will be limited afterwards, having closed the door when the horse has bolted.

The committee has discussed this. It is reflective of the new circumstances in the Dáil that it has agreed not to accept the diktat from the euro-giants. It is important that we show our independence and sovereignty and tell them we are not ready all the time just to rubber-stamp what they want, sometimes in the form of statutory instruments related to much of the legislation coming here from Europe. People are concerned. Perhaps this is why Brexit will occur. Perhaps people in the UK will prove to have wanted to shake off the shackles associated with draconian legislation that is not properly researched or thought through, and without impact assessments on the effects on countries such as Ireland, an island nation on the periphery.

Certain other countries are clever in how they proceed in terms of tax transparency. They might have the very same or a better regime of taxation to attract multinationals from abroad. They might not be as transparent in terms of how they account for that or how they cover it in their taxation system or circulate the information.

I, too, have concerns about the big companies. Deputy Clare Daly mentioned the big accounting companies. We see day in, day out how they operate in this country. They do not work solely for the multinationals. They are involved in receiverships and insolvency cases of any reasonable size. In more than 90% of cases, they are wheeled out. The same golden circle seems to get all the business. It is not a very nice business and can be very unpleasant but the companies are a dab hand at it. They are wheeled out and appointed by the courts, banks and everybody else to take on the business. We found in some cases that the companies acted as advisers to some of the banks that went bust.

We definitely need to have a proper and reasoned debate on all these issues. It is important that we debate this important topic this evening, albeit for a short period. I thank the committee for debating the proposal and not just rubber-stamping it and saying, "Grand, it is all okay".

Acting Chairman (Deputy Eugene Murphy)

The Minister for Transport, Tourism and Sport, Deputy Shane Ross, has asked to make a contribution. The rules do not allow him to make one but, on the basis that the Social Democrats are not here, I will allow him a few minutes, with the agreement of the Members.

Minister for Transport, Tourism and Sport (Deputy Shane Ross)

I thank the House for allowing me to speak. I will be very brief. Like every other Member of this House, I thoroughly support the presence of multinationals and their contribution to this economy, particularly through the provision of employment. It has now become unfashionable to take on multinationals or challenge them in any way in this country because they are so powerful and because we depend on them.

They did very well during the economic boom. My support for the low corporation tax rate and the continued presence of multinational companies in this country is second to none.

Notwithstanding this, many Deputies have made a very good case for examining the activities of multinational companies, particularly the tax treatment they receive. It is utterly wrong that anyone in the House would try to brush this subject under the carpet. I agree with Deputy Richard Boyd Barrett that this subject is almost taboo and free from examination because people are frightened of examining the activities of multinationals or pointing out that certain activity would not be tolerated if an Irish company engaged in it. There is evidence to support that view. For example, I am not aware of any challenge by the Revenue Commissioners to the tax treatment of any multinational company. Native companies have been treated differently, however. It makes me uneasy that we should even contemplate allowing this motion through the House without a debate because it is a very important issue.

There are straws in the wind about multinational companies which would make anybody uncomfortable. One of these is the mystery surrounding the taxation they are paying. There must be a suspicion that they are creating their own tax and deciding what tax they pay. This is done, as everybody knows, through a simple operation by which they charge certain amounts against their profits for intellectual property, thereby allowing themselves to declare and pay the sort of tax they wish to pay. These amounts are phenomenally small in terms of what the companies in question are turning over and their activities here.

One need only consider the taxation figures for the end of last year. From memory, Exchequer revenue was boosted but the figures were utterly inexplicable and no one has been able to explain them. The explanation is clear to me and anybody who is honest about this issue. This was money paid into the Exchequer by multinational companies.

Acting Chairman (Deputy Eugene Murphy)

I ask the Minister to conclude. I have been very generous to him.

Deputy Shane Ross

I am just finishing. If multinational companies are in a position to create their own taxation and increase or decrease it as they see fit, it means the Exchequer is in some danger of being held to ransom.

Minister of State at the Department of the Taoiseach (Deputy Regina Doherty)

On a point of order, I wish to correct the record in case the Minister for Transport, Tourism and Sport was not aware of the position regarding the motion. It was not being put through the House without discussion. Ample discussion and consultation took place at a cross-party committee which met on four occasions. The motion being put to the House was a joint motion.

Deputy Richard Boyd Barrett

There was to be no discussion in the Dáil.

Deputy Regina Doherty

There was all-party consensus.

Deputy Pearse Doherty

Sinn Féin raised an objection to the motion.

Acting Chairman (Deputy Eugene Murphy)

I allowed a point of clarification to be made. There will be no further debate on the matter.

Deputy Richard Boyd Barrett

On a point of clarification, the motion was not to be discussed in the Chamber.

Acting Chairman (Deputy Eugene Murphy)

The debate has concluded. I will put the question.

Question put:

The Dáil divided: Tá, 87; Níl, 35.

Tá

• Aylward, Bobby.
• Bailey, Maria.
• Brassil, John.
• Breathnach, Declan.
• Brophy, Colm.
• Browne, James.
• Bruton, Richard.
• Burke, Peter.
• Butler, Mary.
• Byrne, Catherine.
• Byrne, Thomas.
• Cahill, Jackie.
• Calleary, Dara.
• Canney, Seán.
• Cannon, Ciarán.
• Carey, Joe.
• Casey, Pat.
• Cassells, Shane.
• Chambers, Jack.
• Chambers, Lisa.
• Collins, Michael.
• Collins, Niall.
• Corcoran Kennedy, Marcella.
• Cowen, Barry.
• Creed, Michael.
• Curran, John.
• D'Arcy, Michael.
• Deasy, John.
• Deering, Pat.
• Doherty, Regina.
• Donohoe, Paschal.
• Doyle, Andrew.
• Durkan, Bernard J.
• English, Damien.
• Farrell, Alan.
• Fitzgerald, Frances.
• Fitzpatrick, Peter.
• Fleming, Sean.
• Gallagher, Pat The Cope.
• Grealish, Noel.
• Griffin, Brendan.
• Harris, Simon.
• Harty, Michael.
• Haughey, Seán.
• Heydon, Martin.
• Humphreys, Heather.
• Kelleher, Billy.
• Kenny, Enda.
• Kyne, Seán.
• Lahart, John.
• Lawless, James.
• Lowry, Michael.
• MacSharry, Marc.
• Madigan, Josepha.
• Martin, Micheál.
• McConalogue, Charlie.
• McEntee, Helen.
• McGrath, Finian.
• McGrath, Mattie.
• McGrath, Michael.
• McGuinness, John.
• McLoughlin, Tony.
• Mitchell O'Connor, Mary.
• Moran, Kevin Boxer.
• Moynihan, Aindrias.
• Moynihan, Michael.
• Murphy, Eoghan.
• Murphy, Eugene.
• Naughten, Denis.
• Naughton, Hildegarde.
• Neville, Tom.
• Ó Cuív, Éamon.
• O'Brien, Darragh.
• O'Callaghan, Jim.
• O'Connell, Kate.
• O'Donovan, Patrick.
• O'Keeffe, Kevin.
• O'Loughlin, Fiona.
• Phelan, John Paul.
• Rabbitte, Anne.
• Rock, Noel.
• Ross, Shane.
• Scanlon, Eamon.
• Smith, Brendan.
• Smyth, Niamh.
• Stanton, David.
• Troy, Robert.

Níl

• Adams, Gerry.
• Barry, Mick.
• Boyd Barrett, Richard.
• Brady, John.
• Broughan, Thomas P.
• Buckley, Pat.
• Burton, Joan.
• Connolly, Catherine.
• Coppinger, Ruth.
• Cullinane, David.
• Doherty, Pearse.
• Ellis, Dessie.
• Ferris, Martin.
• Fitzmaurice, Michael.
• Funchion, Kathleen.
• Kelly, Alan.
• Kenny, Gino.
• Kenny, Martin.
• Martin, Catherine.
• McDonald, Mary Lou.
• Mitchell, Denise.
• Munster, Imelda.
• Murphy, Paul.
• Nolan, Carol.
• Ó Broin, Eoin.
• Ó Caoláin, Caoimhghín.
• Ó Laoghaire, Donnchadh.
• Ó Snodaigh, Aengus.
• O'Reilly, Louise.
• O'Sullivan, Jan.
• Quinlivan, Maurice.
• Ryan, Brendan.
• Ryan, Eamon.
• Smith, Bríd.
• Tóibín, Peadar.

Tellers: Tá, Deputies Colm Brophy and Regina Doherty; Níl, Deputies Richard Boyd Barrett and Aengus Ó Snodaigh.

Question declared carried.