Corporate tax avoidance is a high salient political issue in Brussels.
This is largely a response to demands from citizens across the EU to ensure that large MNC’s, particularly from the US, pay their fair share of taxes when operating in the EU single market.
Ireland, as we all know, has been called out, and challenged on this issue.
The companies that the EU have in mind are large Silicon Valley firms, and finance firms operating in the shadow banking sector.
The Commission have recently called for the introduction of a common consolidated corporate tax base (CCTB), to be introduced over two stages. They are also keen to introduce a financial transaction tax (FTT).
These are directly aimed at tackling corporate tax avoidance.
Ireland has said it would veto any attempt to introduce either of these at the EU level. But it was Britain that was most vocal about it.
It’s therefore worth noting that Jean Claude Juncker stated in his state of the union address this morning that he is in favour of moving toward qualified majority voting (QMV) on decisions related to the CCCTB and the FTT.
A post-Brexit EU is going to be a very different terrain for Ireland.
QMV will be used more often. This empowers German and French interests in the European Council, and the numbers stack up to ensure they get what they want.
Is the writing on the wall for Ireland’s veto against the CCCTB?