Source: Mark Stedman/Photocall Ireland
ENDA KENNY HAS responded to criticism of Ireland’s tax regime by British Prime Minister David Cameron by saying the ‘Double Irish’ tax loophole is not promoted by government agencies.
The Taoiseach was responding to remarks by Cameron earlier this week when he identified a “problem with the low rate of corporation tax” in Ireland, saying some businesses are not even paying the 12.5 per cent rate.
This is because of the so-called ‘Double Irish loophole’ which allows multinational companies to legally shift their profits offshore and avoid paying tax.
Speaking at a jobs announcement in Waterford today, Kenny said: “It’s not a promotional tool used by Ireland’s development agencies.
“It’s a construct of multinational companies and their tax advisers which is used to exploit differences between the tax regimes of different countries where they operate.”
Kenny said that that the Irish government shares broader European concerns about “unintended loopholes”.
He said the government is working with the UK and international partners on the OECD’s BEPS process which aims to address perceived flaws in international tax rules.
“BEPS is about tackling mismatches between a country’s tax rules,” Kenny said.
On Ireland’s famous 12.5 per cent corporation tax rate, Kenny again insisted that it is not being changed and it is not being put under scrutiny by the BEPS process.
He added: “Insofar as our corporate tax rate is concerned it’s twelve-and-a-half, it’s a matter of national sovereignty, and it remains so.”