Tax independence
Ireland's tax regime exists within the framework of an international series of agreements, including, notably, the OECD and the EU. Irish Finance Ministers have always emphasised the importance of this national independence when it comes to tax policy. Can you assess the medium term prospects for Ireland to be able to maintain this status quo in coming years?
Andrew Quinn, Head of Tax, Maples Group: I think the EU Anti-Tax Avoidance Directive or ATAD implementing OECD BEPS was really a watershed moment in EU tax policy. Up to that point, EU tax measures were generally nice relieving measures based on EU non-discrimination principles and tax transparency measures and national independence on tax matters among EU Member States was fairly absolute. ATAD though was a case where the Directive when implemented could and would result in new tax liabilities.
That has been followed by a raft of new EU measures, like DAC6 and proposals such as the EU Global Minimum Tax Directive, the EU UNSHELL Directive and the EU DEBRA Directive. Tax measures are also found in other EU legislation such as the EU Whistleblower Directive and the EU Securitisation Regulation.
When you look at the question of the autonomy of Ireland's tax policy, or any country's tax policy, the reality or "realpolitik" of course is that no open globalised economy such as Ireland can truly be completely autonomous when it comes to tax policy. International trade relations, of which tax is of course a key part, is a question of give and take and sensible compromise.
So it is with Ireland, where to look at recent examples, Ireland has engaged with the EU, the OECD and its trading partners on many new tax developments, the most significant of which are the global minimum tax proposals through the OECD Inclusive Framework process and the proposed EU implementing Directive.
Ireland can use its influence and input on these developments – most importantly by ensuring there is due process and transparency on proposed international changes through consultation with industry, citizens and NGOs, just as there is already for Irish domestic tax legislation, and crucially ensuring that proposed EU tax measures preserve the competitiveness of the EU globally.
Originally published by Finance Dublin - Irish Tax Monitor 2022.
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