Budget anti-tax avoidance measures a fraction of what’s needed – Carthy
Sinn Fein MEP Matt Carthy has called the anti-tax avoidance measures in Budget 2017 “much too little, far too late”.
Carthy, a member of the European Parliament’s Panama Papers inquiry, said:
“In this week’s Budget, Finance Minister Michael Noonan announced a number of measures to tackle offshore tax evasion in response to the Panama Papers leaks.
“We welcome the proposal to improve disclosure requirements about offshore assets and particularly the introduction of criminal liability.
"Disclosure requirements must be mandatory and apply across the board, including in relation to existing offshore assets.
"We also welcome the move to give Revenue the resources to recruit more staff to improve the agency’s investigative and compliance capacity.
“Sinn Fein has already made detailed submissions on the inadequacies of the Minister’s proposed changes to the Section 110 regime which is used by Special Purpose Vehicles (SPVs) including vulture funds to almost entirely avoid paying tax.
“We are calling on the Government to ensure all unrealised gains of the affected portfolios under Section 110 are taxed in accordance with normal Capital Gains Tax rules, and for the introduction of strict anti-avoidance measures to tackle the various profit-stripping techniques used by these vehicles.”
“Of course, the elephant in the room during the Budget 2017 announcements was the ruling that Apple had received an illegal selective advantage that allowed it to underpay Irish taxpayers by 13 billion euro. The review announced by the Government and included in the Budget is a mere confidence trick.
“The response to the Apple tax ruling should have been the public inquiry that Sinn Fein demanded, not the appointment of a single economist to carry out a review with extremely narrow terms of reference. It is much too little, far too late.
“Michael Noonan’s biggest failure in this Budget when it comes to combating the industrial-scale tax avoidance that is still going on in this state was his refusal to take on board Sinn Féin’s proposal to scrap the Double Irish immediately and definitively.
“The endless spin from the Government on this issue would have you believe that the Double Irish is dead and buried. In fact it is still in place for companies like Google until 2020. In 2014, Google shifted 10.7 billion euros through using Irish companies, through the Netherlands to Bermuda, where it pays not a cent in tax.
“More than that, the Double Irish is actually firmly in place indefinitely beyond 2020 for companies that use a country that Ireland has a tax treaty with. So tax havens and conduits like Malta are the new partners for multinationals wanting to use Ireland to shift profits offshore.
“The Government needs to take this issue seriously, catch up with the rest of Europe and the international community and restore Ireland’s damaged reputation.”