The recently published report of the United States Senate Permanent Sub-Committee on Investigations of their hearing on Offshore Profit Shifting and the U.S. Tax Code gave prominence to the tax arrangements of two U.S. multinational corporations, both of which have operations in Ireland. The Report finds that U.S. multinational corporations are able to significantly reduce their tax liabilities by legal international tax planning arrangements - there was no allegation of fraud or evasion - and makes recommendations on how U.S. tax law could be improved. Ireland is not mentioned as a tax haven in the Report - and rightly so. The international community does not regard Ireland as a tax haven. Ireland has a comprehensive taxation system covering income, capital and indirect taxes. Tax Treaties with the United States and many other countries confirm our international standing. The January 2011 Global Forum Peer Review Report on Ireland’s legal and regulatory framework for transparency and exchange of information found that Ireland has an effective system for the exchange of information in tax matters and is fully compliant with OECD standards.
Ireland is bound by the same rules on State Aid, the Code of Conduct on Business Taxation, and rulings of the Court of Justice as all EU Member States. Ireland does not support harmful tax competition. Ireland continues to participate fully in the EU Code of Conduct Group, which addresses harmful tax competition, and in the OECD Forum on Harmful Tax Practices. The Mahon Report recommendations concerning the use of corporate vehicles for “corrupt purposes” do not appear to be relevant to circumstances where no fraud or evasion is alleged.
