Ireland is a "strong supporter" of international efforts to reform the tax system, Minister for Finance Paschal Donohoe told MEPs on Tuesday.
Addressing the European Parliament's Pana committee on tax avoidance and evasion, he said the State was one of the first to introduce "country by country" reporting to tax authorities under which multinationals must set out their range of operations abroad to national authorities.
He said he supports commission proposals to extend such rules and added that “Ireland is a strong supporter of the work done in recent years to increase the exchange of information between tax authorities”.
He pointed to the nearly 2,500 taxpayers who recently contacted Revenue to declare “offshore arrangements” covering up to €70 million of their income, ahead of a promised crackdown on the back of such shared information.
Tax haven
Many MEPs regard Ireland as a tax haven and the Minister's speech was a determined attempt to persuade parliament that, whatever about the past – and, he stressed Ireland was not implicated in the Panama Papers revelation which the Pana committee is currently reviewing – Ireland is now one of the "good guys".
“To encourage taxpayers who may have used offshore arrangements in the past to come forward,” he said, “taxpayers were given until May 4th, 2017, to make disclosures under the voluntary disclosure regime.
“Those who failed to come forward by that date face greater penalties, publication of their names and possible prosecution. I am advised that the number of disclosures made before May 4th exceeds 2,500, with a value of more than €70 million. “
“We remain convinced that consistent global action is the best way to achieve a fair and transparent global tax system.”
Ireland is also currently transposing anti-money laundering legislation and will establish a central registers of beneficial ownership information for both companies and trusts as provided for under the directive. Like other member states, however, it opposes MEP demands for open public registers, or public “country by country” reporting obligations.
Action plan
Mr Donohoe also attended a meeting of EU finance ministers which endorsed an action plan on non-performing banking loans and the 28 sets of country-specific recommendations that are the final stage of the 2017 “European Semester”, an annual policy monitoring/co-ordination process.
The specific Irish recommendations, which closely mirror those of the post-bailout monitoring team approved on Monday by the Eurogroup, again reiterated the need to use windfall exchequer gains from either the sale of AIB or in corporate tax receipts to pay down debt.
But the report also emphasised the need to prioritise infrastructure spending.
Ministers also discussed commission proposals to make tax consultants and accountants liable for reporting to the authorities clients’ tax plans that may involve significant avoidance measures, and backed a renewed commitment to completing the capital markets union by the end of 2019.
The action plan, launched in 2015, has seen nearly two-thirds of actions already delivered. The priorities are to strengthen capital markets so as to attract more investment for European companies and infrastructure projects; and improve access to finance in particular for European SMEs and start-ups.
