Budget 2016: Corporate Tax measures regressive - Carthy
Sinn Féin MEP for the Midlands North West, Matt Carthy, speaking today from Brussels has criticised the regressive nature of Budget 2016 noting particularly moves regarding Corporation Tax.
Carthy, a member of the European Parliament's economic & Monetary Affairs committee, stated:
"The move in the Budget to lower Corporation Tax is not only regressive but it will undermine the progress which has been made to date, in attempting to close the loopholes in legislation which Multi-National companies are currently exploiting.
"In recent months I have been proactively involved in the ongoing EU TAXE inquiry Committee which has the stated aim of seeking to bring transparency and accountability to both the European and International Taxation system.
"The right of an Irish government to set our own tax rates, including corporation tax, is one that I have defended at all times.
"However, Minister Noonan has used the Budget to introduce a new Research and Development loophole or ‘Knowledge Box’ offering a tax rate as low as 6 to 6.5%. These ‘knowledge boxes’ have been used internationally as tax avoidance tools.
“Ireland’s reputation has been negatively affected in recent years and while some of this is down to a negative agenda of attacking tax sovereignty, there are genuine concerns raised by Civic and Social Organisations and those working with the developing world that large corporations are using Irish tax laws to avoid contributing their fair share.
“Today's announcement will only entrench such a negative perception. It is indefensible to allow hugely profitable companies free reign to manipulate our tax legislation while ordinary citizens are forced to comply with unjust and unfair taxation measures introduced by this Government.
"There are fairer ways of encouraging investment in Research & Development rather than introducing a measure that will undoubtedly be used by some corporations to avoid paying their taxes. What is required is a mature corporation tax regime based on a 12.5% rate, not vehicles designed to protect vested financial interests".