Claims concerning Corporation tax by elements of the “No” campaign in literature distributed to houses before the recent referendum “Yes” vote had no basis in fact. The position in relation to the influence of Europe on our Corporation Tax policy is straightforward. There is no EU mechanism which can oblige us to change our Corporation Tax rate. Ireland is in technical discussions with the other EU Member States in relation to a Draft Directive concerning a Common Consolidated Corporate Tax Base (CCCTB). These discussions have been going on for just over a year, but are still only at an early stage. We engage in similar technical and political discussions on a wide range of taxation matters, including a Financial Transactions Tax, Environmental Taxes and the Taxation of Savings. In none of these discussions are tax rates at issue. Nothing in the Fiscal Compact has a bearing on these discussions.

There are EU mechanisms to ensure that our tax system is compliant with fundamental EU principles. These concern the Freedoms of Establishment, Movement of persons and of capital and provision of services across borders. We must also ensure that our tax system is compliant with the EU State Aid rules, which prohibit EU Member States giving their citizens, businesses or regions an unfair advantage in comparison with other Member States. We have a high degree of compliance with these rules, and nothing in the Fiscal Compact has a bearing on these requirements.

There is an EU mechanism called the Code of Conduct Group which monitors practices in EU Member States that could constitute unfair business tax competition. Tax Rates are outside the scope of this Group. Nothing in the Fiscal Compact has a bearing on the working of this group.

As already identified, the CCCTB are still at an early stage of discussion.

• CCCTB, if implemented, would be available on an optional basis to Multinational groups
• The recent vote by the European Parliament in support of the CCCTB proposals, while of interest, is not binding on the development of the proposals as the Parliament has only a consultative role.
• Even if ultimately adopted, there is no mechanism to coerce countries into adopting the CCCTB.
• Even if ultimately adopted, there is no mechanism within the CCCTB proposals to coerce taxpayers into using it.