Finance minister wants clarity on 15% corporate tax rate

Government is to consider text on new corporate tax deal over the coming weeks

Finance Minister Paschal Donohoe.

Finance Minister Paschal Donohoe says he has not received any clarity that would make Ireland sign up for the 15% corporation tax rate.

The Organisation for Economic Co-operation and Development (OECD) has been in talks for over eight years to change the collective rate in order to ensure fair competition between countries on corporation tax.

The group will be issuing a further text for the agreement, which the Government will then consider in the coming days.

Mr Donohoe met with G7 Finance Ministers on Wednesday but says he has not been given any clarity on what Ireland's tax rate will be in two years' time.

"I met the finance ministers of America, Japan, France, Germany, United Kingdom, Italy, and I made the case to them regarding where Ireland stands at the moment. I've engaged with all of them directly one on one, for many months in a process that's been under way for many years," he said.

"If I were to go into agreements, the first question that those who create jobs in our country would ask me is what is the rate of tax they will be paying in the future?

The agreement as currently drafted does not offer clarity.

Mr Donohoe said the 15% rate is one of a number of matters, but is also the most important.

"What is also important is how we protect research and innovation within our country, the role of our domestic industry here in Ireland, and also how this issue would then be executed and implemented all over the world," he said.

"This is such a delicate and sensitive matter for countries all over the world. I can't, at this point, give an indication as to what the text will contain given that I have not seen it.

"But when the Government receives the text, we'll consider this text. I imagine we'll need to do that next week, and then there will be a further engagement on this, at which point we will make our view clear."

Pandemic payment

On the pandemic recognition bonus payment, Mr Donohoe reiterated that he believes any payment to frontline workers must be affordable.

"I favour an agreement that is fair, that is inclusive, that is affordable," he said. "The detail of all of this needs to be concluded with those who represent many different parts of our economy and society. We have to put all of this in the context of the extraordinary efforts that so many have put in to protecting our country at a time of real crisis."

The Fine Gael parliamentary party heard last night that the possible €500 bonus payments should scrapped and the money instead used for a €10 rise in the State pension.

The minister said such meetings "should be private" but added the budget it being crafted "in the context of our national debt having gone up by €34bn".

"We're in a really different place to where we were a year ago, with our economy safely reopening, a vaccination programme going so well, and the number of people on the PUP is falling so quickly, but there are constraints. 

"I want to get to a point that by 2023 we're no longer borrowing for day to day spending, that means we have to make choices about money that's available, and the Government will do that," he said.