Ireland wants clarification on the rate at which the United States will tax global multinational profits before signing a broader corporate tax deal, the Minister for Tánaiste and Business said.
culminating in Washington yesterday, Leo Varadkar said he also wanted assurance that a global minimum corporate tax did not exceed 15 percent.
US President Joe Biden wants to raise a national tax on global US corporate profits to 21pc, although congressional lawmakers are discussing a lower rate of around 16pc.
“We would need to see where it might be,” Varadkar said at an event hosted by the Center for Strategic and International Studies (CSIS), a US think tank.
“It would have an impact on us, but we fully respect the right of the United States to make this decision.”
Meanwhile, talks on a global minimum effective rate of “at least 15%” are intensifying, with an agreement to be signed early next month during talks led by the Organization for Economic Co-operation and Development (OECD ) based in Paris.
Mr Varadkar said he was still concerned about including the phrase “at least” in a draft agreement first signed in July and now supported by 134 of the 140 countries in talks.
Ireland is one of the six holdouts, which include other EU members Estonia and Hungary, as well as Nigeria, Kenya and Sri Lanka.
“[For] anyway, we’d like to know that’s the rate, and it will stay at the rate, and not change in five years or 10 years. Mr Varadkar said.
Reports in the Business post over the weekend, said the government “was preparing to concede” to the OECD deal if the wording was changed and the rate was set at exactly 15pc.
Mr Varadkar said Ireland would prefer to be “in the tent both politically and economically” at the OECD, but wanted to keep the corporate tax rate here “low and constant”.
“It would make more sense for us to be inside any global framework, and it’s in our nature to be inside global frameworks. It’s our instinct and that’s where we want to be, ”he said.
“But one thing that has worked really well for us in our system is having this low corporate tax rate. But it’s not just the rate, it’s reliability. That is why we would like to keep it low and keep it constant.