Minister for Finance Paschal Donohoe has said that Ireland will be vigorously making the case for tax competition and for maintaining a corporate tax rate of 12.5%.
With negotiations on the issue set to proceed, Minister Donohoe said he is confident that Ireland will continue to be a really attractive place to do business.
Yesterday, Mr Donohoe said that the global minimum corporate tax rate of 15% proposed by the Group of Seven wealthy nations was just a signpost and it was too early to say whether agreement can be reached on that or any figure.
Paschal Donohoe said much further work was still required to reach a deal among Organisation for Economic Cooperation and Development countries.
Speaking on RTÉ's Morning Ireland, Mr Donohoe said that he is working to ensure that Ireland continues to maintain a really competitive tax policy and be an attractive place to create employment in.
He said that EU pandemic funding being given to Ireland is not contingent on a decision to increase the corporate tax rate.
He said that he is "very confident about our overall competitive offering but it is really important that small and medium sized economies do have the ability to use a lower rate to offset the advantages of scale, location and industrial heritage".
Paschal Donohoe said the world of Foreign Direct Investment is changing but will "continue to be an indispensable part of our economic model".
Minister for Finance Paschal Donohoe has said Ireland will be vigorously making the case for tax competition and for maintaining a corporate tax rate of 12.5% | https://t.co/9zOqZW9NLf pic.twitter.com/kQlogGVL4F— RTÉ News (@rtenews) June 11, 2021
He added that "massive companies" have made big investments in Ireland this year.
The Minister for Finance also said today that getting people get back to work is reliant on Ireland being a good place to invest in.
He said no decisions have been made yet to increase corporate tax rates, including in the UK and US, and he will continue to assert Ireland's position as the OECD examines the matter.
Mr Donohoe said the issue has always been a very contested one within the EU and there has been a lot of focus on the Irish corporate tax rate and policy.
However, he said that "there's an awful lot to play out on this" and many other countries favour tax sovereignty and are concerned about higher rates.
He said he has directly engaged with the US Treasury Secretary Janet Yellen on the issue and will continue to do so.
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Keeping the existing rate is required to maintain and grow employment and for Ireland to continue to be an economy with a good share of international investment, he stated.
This will "allow us to respond to other challenges," he added.
Paschal Donohoe said that along with FDI and international investment, the domestic economy is strong.
Many small and medium-sized companies are taking the "step up" to grow their share of exports to many parts of the world, he added.
The Minister said that there are difficulties and challenges to confront but also opportunities as many Irish abroad may be able to come home to work from Ireland.
He added that rules on tax residency and for company registration for corporate tax are "crystal clear" .
Minister Paschal Donohoe says he is examining the introduction of a vacant site tax, but it will not be decided upon in time for this year's Budget | https://t.co/ygOZUpTnU0 pic.twitter.com/V2LHcKMamz— RTÉ News (@rtenews) June 11, 2021
The Minister for Finance also said today that he is examining the introduction of a vacant site tax, but it will not be decided upon in time for this year's Budget.
The Minister said that recent changes to the Local Property Tax will allow data on the quantity of unused property to be assessed.
He said he will continue to examine tax measures that will provide a more efficient use of land.