EU tax plan ‘is a bigger threat to Ireland than Brexit’

Corporation tax harmonisation plans across the euro zone pose a bigger threat to Ireland than the departure of the UK from the European Union, the head of the Irish Fiscal Advisory Council has strongly warned.

Speaking to the Oireachtas Committee on Budgetary Oversight, the chair of the council, Seamus Coffey, said Ireland could lose up to €4 billion worth of corporation tax if EU-wide tax rules for multinationals were set.

His warning came as European Commission president Jean-Claude Juncker told MEPs that tax rules for Facebook, Google, Amazon and other digital companies should no longer be subject to veto by member states.

“Europe has to be able to act quicker and more decisively,” Mr Juncker told the European Parliament in Strasbourg, saying existing EU rules should be used to reduce the power of individual EU states.

Mr Juncker’s declaration came ahead of Friday’s meeting of EU finance ministers, where the Minister for Finance Paschal Donohoe will be faced with an Estonian plan to tackle global digital giants.

Weaknesses in international tax rules have “unintentionally turned into an unequal competitive advantage for the most successful and rapidly growing businesses”, says the Estonian document.

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