At a hearing on 27 May, the Institute provided evidence at the invitation of the Oireachtas SubCommittee on Global Taxation in Leinster House. The Institute is the only professional association to have contributed to the work of the Committee. Other contributors to date include the OECD Head of Tax Pascal Saint-Amans and representatives of the Department of Finance and the Revenue Commissioners.

In his opening statement to the Committee, Institute Director of Taxation Brian Keegan commented that there is no such thing as “international tax” – taxes are paid by companies to the sovereign governments who hold the taxing rights. A clearly defined interaction of the Irish tax system with the tax regimes of other countries is fundamental to international trade. Ultimately tax is a business cost for companies, to be predicted and managed. It carries responsibilities but also it must be managed in the same way as utility, distribution, employees and other costs must be predictable and manageable. If our tax regime were to be too closed and protectionist, Irish companies simply would not be able to trade abroad, nor would Ireland be an attractive destination for companies seeking to locate operations in this part of the world.

Over the course of the questioning which followed from members of the Oireachtas, explanations and clarifications were provided on the operation of tax planning by multinationals to defer their tax liabilities, and the role of anti-transfer pricing rules and Double Taxation Agreements. The Institute vigorously defended Ireland's international reputation. That is not to say that there is not still room for improvement, and particularly reputational improvement. Tax legislation and best practice can and will evolve, not least because many of the rules which apply not only in this country but in other countries across the globe predate the growth in cross-border trade and the pre-eminence of intellectual property on the balance sheets of international companies. Equally vigorously we pointed out the role of Chartered Accountants in the operation of the tax system and the promotion of tax compliance.

The Institute is committed to a full engagement in the tax debate. This commitment was publicly acknowledged by the Department of Finance at the launch of the public consultation this week on Base Erosion and Profit Shifting. The consultation document notes the process already underway by the Irish authorities with business groups organised through, inter alia, Chartered Accountants Ireland.

A recording of the proceedings is available on the Chartered Accountants Ireland YouTube page.