Varadkar says Ireland wants to be a ‘tent’ on the OECD

Changes in international taxes

Ireland’s deputy prime minister says his country does not want to be seen as a tax collector and would like to live in a “tent” while Paris spokespersons want a 15% international tax agreement.

Leo Varadkar outlined Dublin’s plan in response to OECD’s plans to raise corporate taxes from 12.5% ​​to 15%. Varadkar assured that many Irish companies will still benefit from lower prices.

If the Irish lose their opposition it could be a serious problem for them to reach the international level, which is now united in the same way.

The 140 countries participating in the agreement will meet on October 8 and those close to the talks say they expect similar results. the agreement was reached in July, with strong support from Washington.

“This agreement will be very similar to what has been offered. It just needs to be finalized, “said someone close to the discussion.

Ireland’s idea of ​​a global tax system has become increasingly difficult to move forward since Biden’s administration has embarked on a series of legislative initiatives through Congress.

The law seeks to raise taxes levied on taxes levied on US foreign nationals in countries where domestic taxes are lower. Given that most low-income countries in Ireland are US companies, if Congress approves this law Ireland will lose their tax advantages.

This seems to have taken a turn for the worse and Varadkar has demanded a new way to levy taxes in Ireland with a fine of 12.5% ​​on companies and companies earning less than € 750m.

“Any alliance we may or may not have with each other will not affect Irish business. It will not affect even large or medium-sized businesses. The 12.5% ​​price will remain in place, “Varadkar said.

The Irish finance ministry said Wednesday that the country was “closely aligned” with the agreement but still maintained “limits” on global taxes of “at least 15%”.

“Ireland wants to join the alliance but there is currently no information on what is going on,” he told the Financial Times.

However, with OECD negotiations to be based on the world’s lowest rate of 15%, instead of the original saying “at least 15%”, Dublin can say that this has reduced tensions at home.

Some countries have signed the OECD treaty in silence over the summer. Togo became the 134th country to come from the 140 countries affected by the talks.

Although there was one agreement, some dissatisfaction remained. Earlier this week the G24 group of developing countries he wrote to the OECD stating that the funding for developing countries from the treaty will be “limited” and “non-sustainable”.

Areas to be finalized include international dispute resolution and resolution mechanisms that, although not tax havens, attract companies through various taxes, often in the form of machinery and equipment.

“There has been a lot of opposition from Eastern Europe and the tax system, and China is also affected,” said a source close to the talks, adding that countries remain dissatisfied with “real economic” exemptions.

The EU preserving Hungary was one of the countries most concerned about the size of the statues.

Other sections of the OECD agreement, which deals with foreign taxation, also need to be finalized. So far, no agreement has been reached on the actual amount that most countries around the world have to pay taxes based on where the goods are sold.

If the countries end the treaty, the OECD will convene a multilateral meeting to change international tax agreements in the first half of next year. The new government will take effect in 2023.

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