Paschal Donohoe

 

The recently published update on Ireland’s Corporation Tax Roadmap 2021 committed to review Ireland’s tax treaty policy, taking account of international developments, and publish a tax treaty policy statement by the end of 2021.

 

In that regard the Department of Finance is inviting interested parties to take this opportunity to contribute to this consultation with a view to informing Ireland’s future tax treaty policy. Specifically in relation to how such a policy can continue to support economic growth and prosperity and having regard to Ireland’s development commitments.

 

The purpose of tax treaties has evolved in recent decades and it is now timely to consider the broad direction of Ireland’s tax treaty policy, particularly in the context of potential outcomes of international tax discussions at the OECD.

 

The public and interested stakeholders are now invited to give their views on the issues detailed in the public consultation document. Responses received on the policy issues detailed in this public consultation will form part of the consideration the tax treaty policy statement, which will set out the broad parameters of Ireland’s treaty policy.

 

The consultation period will run from today 7 April 2021, to 12pm on 7 May 2021. Any submissions received after this date may not be considered.

 

The preferred means of response is by email to: taxtreatypolicy@finance.gov.ie

 

 

 

As outlined in the recently published update on Ireland’s Corporation Tax Roadmap 2021, the Department of Finance has committed to review Ireland’s tax treaty policy, taking account of international developments, and publish a tax treaty policy statement by the end of 2021.

 

The purpose of bilateral tax treaties is to promote economic relations between countries by eliminating double taxation and tackling tax avoidance and evasion. Double taxation agreements, originally intended to prevent taxpayers being taxed twice on the same income by two different jurisdictions, have evolved over the years to incorporate other aspects such as non-discrimination, exchange of information, mutual agreement procedures and, most recently, the anti-abuse procedures brought about by the OECD BEPS programme.

 

For a number of years, it has been considered desirable that Ireland, as an open export oriented economy with a relatively small home market, would benefit from an extensive treaty network. It has heretofore been Ireland’s policy to expand and maintain Ireland’s tax treaty network in order to remove obstacles for Irish companies to operate competitively abroad and to facilitate inward trade and investment from partner countries. Ireland currently has signed double taxation agreements with 74 countries, of which 73 are in effect.

 

It is now timely to consider the broad directions of Ireland’s tax treaty policy, particularly in the context of potential outcomes of international tax discussions at the OECD.

 

In developing the Policy Statement, the Department is consulting with key stakeholders, including economic representative bodies, to ensure that Ireland’s tax treaty network can continue to support economic growth and prosperity, particularly in relation to new or emerging sectors of the economy.

 

The Policy Statement will have a particular emphasis on tax treaties with developing countries, having regard to Ireland’s development commitments and in consultation with the Department of Foreign Affairs and Irish Aid.

 

Once this process is complete, it is intended that a tax treaty policy statement will be published, which will set out the broad parameters of Ireland’s treaty policy.