The European Council today reached agreement on proposals to automatically exchange tax rulings and certain transfer pricing agreements between member states. It is not immediately clear whether any historic opinions, rather than rulings, issued by the Irish Revenue would fall within the scope of the provisions. However, regardless, the measures announced today should pose little threat to Ireland given our fully transparent tax regime.
Of greater concern for Ireland will be any plans to drive forward the Common Consolidated Corporate Tax Base (CCCTB). Proposals around the “consolidated” tax base in particular would significantly erode the benefit of Ireland’s low corporate tax rate as profits could be allocated away from Ireland in favour of larger, higher tax, jurisdictions.
In our view, there is little need for the EU to proceed with such plans while the BEPS project is in full swing. Alternative EU corporate tax plans will only add to the uncertainty that many large groups face in determining the future make-up of the global tax landscape.