World leaders vow to tackle tax evasion as Irish corporation rate crops up

Ireland’s tax status became a talking point at the G8 as world powers moved to clamp down on corporate tax evasion, Enda Kenny has admitted.

However, the Taoiseach insisted the leaders saw nothing wrong with the Irish situation and Dublin is happy to sign up with the summit’s plan to clamp down on tax transfers.

A 10-point plan by the leaders of the seven major Western economies and Russia insisted the “scourge of tax evasion” needed to be stamped out via measures like greater sharing of information by countries.

The final communiqué from the gathering at Lough Erne, Co Fermanagh, stated that global firms should not be able “to shift their profits across borders to avoid taxes, and multinationals should report to tax authorities what tax they pay where”.

Mr Kenny revealed Ireland’s generous corporation tax regime was brought up at the G8 summit — though not at any of the side events he attended.

Stung by recent claims by influential US senators that Ireland operates as a “tax haven” for corporate giants such as Apple, Mr Kenny was keen to defend the country’s reputation.

Referring to Ireland’s corporate tax rate, he said: “I know it was referred to in the G8 itself. I was able to account for the Irish tax position but I strongly welcomed the 10-point plan and while we’re not a member of the G8 this is part of the principle that Ireland has aggressively been pursuing during our EU presidency.

“I was aware that the matter had been referred to in the context of Ireland’s corporation tax rate, which quite a number of leaders were very clear to say that just because a tax rate is pitched at a particular level doesn’t mean anything other than that.

“And I was able to remind the meeting of course that our corporate tax rate is statute-based and is absolutely clear.”

Mr Kenny, who attended the fringes of the two-day conference of the leaders of the US, Russia, Japan, Germany, Britain, France, Italy, and Canada, as rotating head of the European Council, said that only a united international effort would be able to deal with corporate tax avoidance.

“The European Council at its last meeting concluded that no country on its own can deal with these issues unilaterally and therefore there is a need for an international movement an collaboration among the countries,” he said.

“Countries can only do this in unison and Ireland is very much in favour in having the international tax code, the international tax movement dealing with this. We want to be part of that.

“Ireland will participate in the work and consideration of what is the best thing to do here with tax evasion, with tax fraud and with transparency.”

The G8 also agreed on an anti-terrorism agenda such as not paying ransoms to kidnappers, but failed to reach a consensus on how to end the civil war in Syria.