Ireland's low 12.5pc corporation tax rate safe under new EU anti-tax avoidance rules - Moscovici
It's estimated that European Governments are losing out on €60bn per annum due to schemes
New anti-tax avoidance rules will not touch Ireland’s 12.5pc corporate tax rate, the EU has insisted.
“Our idea is certainly not to impose any kind of corporate tax rate at the national level,” said EU tax chief Pierre Moscovici today.
“And we are not going to tell this or that country, you cannot any more have, let’s say, 12.5pc - I say that without any purpose - tomorrow,” he told reporters in Brussels.
“We are not going to force any country to raise its corporate tax rate.”
He was speaking after publishing a series of draft laws to to stop multinationals from shirking their corporate tax bills in the EU.
The proposals are designed to prevent large companies shifting profits to tax havens and shopping around the bloc for sweetheart tax deals.
However, Mr Moscovici - a former French finance minister - did call out countries that were softer on large companies operating on their territory.
“Until now, member states that make great efforts to fight abusive tax practices are being undermined by those that take a more lenient approach,” he said.
“Some struggle to enforce their national tax rules simply because others have more avoidance-friendly regimes.”
The new draft rules have to be unanimously approved by all 28 EU governments and the European Parliament before they become law, which Mr Moscovici estimates could happen within six months.
The Government will then have two years to implement them.
He added that he doesn’t expect any reservations from Ireland on the new rules, and praised the Government for signing up to international standards agreed last year by the Organisation for Economic Cooperation and Development.
The OECD’s 15-point plan to combat what they call base erosion and profit shifting (or Beps) is not legally binding.
“I have had several occasions to emphasise how Ireland is implementing Beps measures now and the way they’re doing it is quite remarkable, and I can’t see any reservations arising,” Mr Moscovici said.
The EU rules announced on Thursday use Beps as a starting point, bringing into EU law the non-binding OECD rules.
They include moves to block the most common methods used by companies to avoid paying tax and to get countries to share tax-related information on multinationals operating on their territory.
Today’s draft laws will be followed later this year by new rules on how large companies should calculate their corporate tax bills - knowns as the common consolidated corporate tax base.