Taoiseach Enda Kenny has defended Ireland's corporate tax rate of 12.5 per cent, dismissing suggestions that the 'Double Irish' was some Irish government creation designed to attract multinational companies to Ireland.
Mr Kenny said the government was committed to retaining the current rate.
He added that he had noted the issue of the 'Double Irish' which was recently raised by British Prime Minister, David Cameron at the Conservative Party conference, but stressed that the device whereby multinational reduce their tax liability was not an Irish creation.
"I saw the comments from the British Prime Minister at the Tory Party conference in respect of corporate tax rate - our tax rate is 12.5 per cent - it's always been that way and will always be that way - we are not changing it," said Mr Kenny.
“We are not just a brassplate operation here in Ireland, companies are here with people who work here and on that basis, taxes are based on where profits are earned so the remarks made by the Prime Minister in respect of the Double Irish is not a promotional tool used by Irish agencies.
“The Double Irish is a construct of multinational companies and their tax advisors which is used to exploit the differences between tax regimes in the different countries where they operate,” he added.
Speaking in Waterford at the announcement that US multinational, West Pharmaceuticals Services was creating 150 new jobs in a €100 million investment, Mr Kenny said Ireland shared the concerns of the UK and other partners in the OECD about multinationals exploiting tax loopholes.
"We have expressed these concerns at the European Council about unintended loopholes being exploited by companies to reduce their tax bills and the agreement at the council was that there should be a response to this globally," he said.
“So we will continue to work with the UK and our international partners in the OECD on the best process to review all these tax restructuring arrangements being used by multi-nationals both in Ireland and other jurisdictions.”
Mr Kenny said Ireland had nothing to fear from such a global review and that he believed it would offer Ireland more opportunities to further attract foreign direct investment rather than pose a risk to existing multinationals operating here.
"The Department of Finance has completed its consultation process with industry and all the other relevant agencies regarding the implications of the OECD Base Erosion and Profit Shifting (BEPS) process," he told a business audience at the IDA Ireland supported West Pharmaceutical Services launch.
“I actually believe that there are more opportunities for Ireland than risks from international reform to remove unintended tax loopholes .... we have nothing at all to fear from a process that removes the ability of multi-nationals to pay even lower tax rates internationally,” he said.
“We still have the lowest corporate tax rate in the OECD and these rates are matter of national sovereignty .. . our tax rate is 12.5 per cent and it will remain so,” he said.
Mr Kenny also re-iterated the government’s commitment to reducing the top tax rate of 52 per cent in this month’s budget.
