The Minister for Finance, Paschal Donohoe (pictured), has opened a public consultation on plans by the Organisation for Economic Co-operation and Development (OECD) to reform how multinational companies are taxed.

Earlier this month, Ireland was not among the 130 countries that signed up to a framework drawn up by the OECD.

The plan, which includes two separate ‘pillars’, is aimed at ensuring that multinational companies pay “a fair share” of tax wherever they operate.

Challenges and opportunities

Ireland is backing the ‘pillar one’ proposals, which would shift some taxes from multinationals’ home countries to markets where they have business activities and earn profits, regardless of whether firms have a physical presence there.

Minister Donohoe said, however, that Ireland had expressed particular reservations about the second pillar, which includes a proposed global minimum effective tax rate of “at least 15%”.

The Department of Finance said that the consultation would help to identify “the challenges and opportunities” of the proposals for Ireland’s corporate tax code and broader industrial policy.

Certainty and stability

"It is essential as we emerge from the COVID-19 pandemic that the international tax system provides the necessary certainty and stability to support growth and investment, and Ireland is committed to playing our part in reaching the comprehensive agreement,” said the minister.

“I am committed to ensuring that Ireland’s tax policy continues to support economic growth and prosperity, and, in this respect, I would welcome the views of the public and key stakeholders on the key aspects of the OECD proposals”, he added.

The consultation will run until Friday, 10 September.

The remaining elements of the OECD framework, including the implementation plan, are due to be finalised in October.