A European Commission proposal on a common corporate tax base must respect the sovereignty of national tax systems
Brian Hayes MEP today accompanied an EU tax delegation to Dublin which is seeking to examine Ireland’s corporate tax system. Speaking during the delegation visit, Mr. Hayes commented that an EU Commission proposal to introduce a common corporate tax base, which is expected to be released next month, must respect the principles of sovereignty enshrined in the EU treaties.
“It is very welcome that we have a European Parliament delegation coming to Dublin. Ireland’s corporate taxation system has taken a lot of criticism in recent years and this delegation presents an opportunity to clarify to our EU counterparts how Ireland’s corporate tax system really works. We have nothing to be ashamed about given the transparency and efficiency of our corporation tax system. In fact, the OECD recently concluded through its Global Forum on Tax Transparency that the Irish tax system is as good as anywhere in the world in terms of exchange of tax information.
“Ireland has moved positively and has come into line with international standards, particularly through working with the OECD, removing the ‘Double Irish’ and coming to an agreement on the FATCA arrangements with the United States.
“The delegation had a positive meeting with Finance Minister Michael Noonan this morning. Minister Noonan made a clear commitment to the OECD process of dealing with tax transparency as this is something that needs to be done at an international level.
“New plans are currently being drawn up for an EU Commission legislative proposal establishing a common corporate tax base in the EU. This is nothing new. A previous proposal on CCCTB was discussed among EU Member States but did not receive enough support. This is a sensitive issue and the Commission needs to be extremely careful that it does not encroach on Member States individual tax policy. The EU Treaties make it clear that Corporation Tax rates are not a Community competence, it is for Member States to decide.”
2016 elections in Northern Ireland, Scotland, Wales and London on 5th May now likely to coincide with In-Out referendum vote
The Queen’s speech in Westminster today (Wednesday) set out the legislative agenda for Prime Minister Cameron’s new Conservative Government. A long list of legislation priorities were announced by the Queen in a speech written by the UK Government. The only legislative proposal in the speech to be given a timeframe was a law to allow for an In-Out referendum on the UK’s membership of the European Union.
“The fact that the text contained a reference to introduce ‘early legislation’ is very telling. No other legislative proposal in the speech was given the ‘early’ timeframe. While the speech went on to say that the proposed legislation will allow for a referendum ‘before the end of 2017’ this is the exact text of a previously proposed Bill that had a lot of support from Tory backbenchers and is already in circulation. This existing Bill allows for a vote anytime before 2017.”
“With the UK to assume the Presidency of the EU in the second half of 2017, a 2017 referendum is unlikely. The UK and Brussels will want to avoid a UK Presidency being dominated by the UK negotiating with itself on behalf of the EU. French and German elections in 2017 also make a 2017 date unlikely. The Dutch Presidency of the EU in the first half of 2016 could facilitate UK negotiators as the Dutch share concerns about a number of reforms. Were they to reach agreement, a 2016 vote would be a certainty.”
“Elections to the Assemblies of Northern Ireland, Wales and London, a Scottish Parliament election and a London Mayoral race are already set to take place on 5th May 2016. These areas are seen as strong supporters of staying in the EU and could be the deciding factor.”
“As the biggest issue for Irish foreign policy since Independence, a UK referendum next May means that 2016 is not only an important date for our history but also an important date for our future.”
Minister Noonan’s announcement on Friday shows that clear progress has been made on the issue
Article by Brian Hayes MEP which was published in the Sunday Business Post on 24th May 2015
Post World War Two different European counties needed the European Union for very different reasons. For Germany their commitment to democracy after nazism was expressed by their commitment to the EU. The French needed a new relationship with Germany, a kind of new economic inter-dependence, and found it in the EU.
For others like Spain, Italy and Greece they needed the EU to bookend a period of military control and dictatorship. The new accession counties to the east expressed their independence from soviet domination by joining the EU.
Ireland needed Europe for slightly different reasons. How independent were we in the 1950s because of our dependence on Britain? The punt was pegged to sterling. The Bank of England effectively set our interest rate. The economic war with Britain in the 1930s highlighted just who was boss in trade and export terms.
We joined with the British in 1973, because we couldn’t have joined without them. I wonder if they were to leave the EU now, would the same logic apply?
Our economies are totally connected and not just on trade both ways. Our economy resembles the British model. IT, financial services and a heavy dependence on exporting mark both of us out. We are both very Northern Europe is the economic model we employ.
It’s also fair to say that we have been fortunate in recent years to have the British powering ahead, especially when the euro zone was so sluggish. Without that performance our recovery would have been very flatfooted.
Ireland joining the EU was a kind of coming out to the world. Much of the progress we have made since joining the EU, both with the economy and in Northern Ireland – is due to our membership of the EU.
For Britain they never really understood why Europe needed this thing called The EU in the first place. They had won the war. Britain didn’t go the way of fascist Europe as their institutions remained intact.
And having been unable to understand the need for EUROPE, they were then prevented from joining it because of French interests. Like us they waited in line to join.
Yes The British are an island people just like us. But unlike us, they have failed to explain and sell the benefits of Europe to their citizens. Europe in the UK is a battering ram for politicians who seem unable to understand Britain’s place in the world. That will have to change if David Cameron is to succeed on his greatest challenge yet – to settle Britain’s problem with Europe.
The upcoming UK in out referendum on Europe is the biggest decision effecting Irish foreign policy ever. It’s ramifications are without exaggeration enormous for us and for the rest of Europe. Were Britain to leave the EU, we would face a terrible dilemma. This debate effects us all. And the Irish political establishment needs to wake up to proper contingency planning for all possible referendum outcomes in the UK.
David Cameron needs a deal and we can help in being a bridge of interpretation for those who can deliver it. Germany wants to help Cameron and will do everything, bar treaty change, to keep the British in.
Losing a big county from the EU could have a knock on effect. Would the Finns or the Dutch want to go next? That’s what really concerns the Germans and that’s why a deal will happen .
David Cameron has so far said nothing that would allow him not to do a deal. From his first major Bloomberg speech to the recent UK election, he hasn’t boxed himself in. Many in Europe agree with Britain’s argument for reform of the EU, but resent the way that reform is put forward as an exclusive British concern.
So what might that deal look like? An honest stocktaking exercise of what has and hasn’t worked within the single market too date. A demand that those counties not members of the Eurozone – be involved more, especially where euro zone decisions effect them. Probably a final acceptance that the EU today is permanently two speed. A more effective decision making process. Less inter institutional gridlock. Better use of the EU budget to stimulate growth and more SMEs.
A good start was made this week in Brussels. Commissioner Timmermans (a rising star within the commission Curia) produced a raft of good ideas to cut out some of the over regulation landscape built up in the EU. A straight talking Dutch man, speaking with a perfect English accent, fired the first shot in the great UK referendum debate .
If David Cameron drops his talk of migration and the right of european citizens to work where they like, he can succeed in getting a deal. He will need friends in court. And that’s where we can help.
If he succeeds in pulling it off, he will have achieved what looked like the impossible and killed off UKIP. An objective that he and the new Labour leader also have in common. If he fails all bets are off – for Europe and for Ireland.
Brian Hayes MEP for Dublin today said that the European Commission is clearly in a position to investigate why standard variable mortgage rates are so high in Ireland compared to the rest of the Eurozone.
“The European Commission’s role in competition policy is to ensure that companies and businesses across the EU compete fairly and offer products which reflect market conditions. Clearly, variable mortgage products in Ireland do not currently reflect market conditions given that the ECB interest rate is 0.05%, while many banks are charging excessive rates well over 4% for variable mortgage products.
“Commissioner Jonathan Hill informed me of the Commission’s position on this issue and it is unlikely that the Commission will investigate variable mortgage rates since he believes that this issue does not affect trade between Member States. But I believe there is clear scope for the Commission’s involvement on this issue. There needs to be some investigation why variable rates are so high in this country and given that banks interest rates’ are set by a European institution, I believe that the European Commission can take action.
“There needs to be a clear examination as to why other banks are not entering the market in Ireland. Competition among Irish banks is poor and this is a factor which has allowed variable mortgage rates to soar. In Northern Ireland there about 28 institutions offering mortgage products while in the Republic there are only really 6 players. Interest rates for variable rate mortgage holders in the Republic are between 1% and 1.5% higher than similar mortgage customers with the same banks in Northern Ireland.
“I welcome the Central Bank of Ireland’s work on this issue but there needs to be an EU assessment of why Ireland is so far behind its Eurozone counterparts in offering reasonable variable mortgage products.”
The European Parliament today gave its final approval for new Anti-Money Laundering rules which aim to prevent money laundering and terrorist financing. Brian Hayes MEP for Dublin called on the government to scrutinise how the new rules will affect the various industries concerned, particularly the gambling industry.
“It is very much welcome that the Parliament has given final approval for new anti-money laundering rules. These rules will lift the veil of secrecy from the various methods by which criminal groups can launder money in the EU. Member States will now have two years following the adoption of the legislation to transpose the rules into national legislation.
“The Government should use this two-year window to conduct a high-level report on how these rules will affect the various industries concerned, particularly the gambling industry. The legislation will oblige gambling institutions to conduct customer due diligence for single transactions over €2000 as well as a series of several bets that appear to be linked.
“There needs to be a proportionate response from the government. The government should examine the greatest risk areas of the gambling industry as opposed to targeting some gambling operations that pose lesser risk to the safety of our financial system.
“Member States will be given some discretion with the implementation of these rules. Some types of gambling services can be exempted – for example, full customer due diligence procedures for on-course gambling which is a lower risk service should be exempted. Many of the rules are very onerous and would jeopardise the fate of some small bookmaking operations which should not be the goal of this Directive.”
Speech by Brian Hayes MEP to the American Chamber of Commerce to the European Union, Tuesday 19th May 2015
Speaking at the American Chamber of Commerce to the European Union event in Strasbourg last night (Tuesday), Fine Gael MEP, Brian Hayes described the upcoming UK Europe Referendum as a golden opportunity to resolve Britain’s issue with Europe. “This is a once in a lifetime opportunity for Britain and Europe. The European Union needs to be generous and willing to meet the UK government at least half way in the negotiation that will follow.”
“Britain is a creditor country within the EU, in that it pays into the EU budget more then it draws down. But more importantly it is just one of 6 EU countries who have a Triple A status currently. If Britain were to leave the EU, would other creditor countries follow them? There is a real concern in Europe that a British exit would have a knock on effect and that other countries, such as, Finland or the Nederland’s, might be tempted to go it alone following a British withdrawal. Europe needs Britain.”
“I also believe that the European Parliament needs to play a full roll in these negotiations. The Parliaments’ roll has dramatically changed in recent years from been a talking shop in the 1970s and 1980s into being a genuine legislative assembly today. Co-Decision making between the Council and the Parliament is now the order of the day. Whatever deal is negotiated for Britain – must be fully in line with the wishes of the European Parliament. Britain and the European Council need to understand this. The rules of the game have changed forever as a consequence of the Lisbon Treaty. Using the Parliament to simply rubber stamp some backroom deal on the question of Britain; will not wash. I believe that the European Parliament and other EU Institutions will be generous and politically aware of the deal that needs to be concluded between Britain and Europe.”
“On eight occasions the people of Ireland were given the opportunity by way of referendum to vote on the European Union. By way of contrast the British people were only given one opportunity to have a direct say by way of referendum on the then EEC and that was in 1975, forty years ago. Interestingly on that occasion the decision to join the EEC was taken by Parliament and subsequently endorsed in referendum two years after the event. No one in Britain under the age of 60 has ever been given a chance to vote on the EU. A direct referendum involving all UK citizens will resolve the EU issue in Britain one way or another for this generation.”
“The British people I have spoken to have often expressed the view that they are entitled to have a direct say on something that so profoundly impacts their lives. And who can disagree with them? The EU is a much transformed institution since 1975 and I believe David Cameron made the correct judgement call when he stated in his Bloomberg speech on Britain and the EU in January 2013 “It is time for the British people to have their say. It is time to settle this European question in British politics”.
“Britain’s membership of the EU continues to be a disruptive influence in British politics, particularly in Conservative party politics. The divisions being caused on this issue are reminiscent of the divisions in previous generations on Home Rule for Ireland and the abolition of the Corn Laws.”
“There is now a deep fracture within the Conservative Party on the merits of membership of the EU. There is also a strong anti-EU sentiment in some sections of the Labour Party and of course UKIP which won 12% of the popular vote in the recent general election is in favour of withdrawal from the EU. The debate on membership of the EU is no longer a matter exclusively for the London government; Scotland, Wales and Northern Ireland will all have their own independent viewpoints on the way forward”.
“Now that the general election is over the British government will begin a process of negotiation with its EU partners. The British negotiating team is clear, it wants to put the terms of a new settlement to an in/out referendum to the British people no later than 2017. The Governor of the Bank of England has very recently made the point that the prospect of a referendum is stoking business uncertainty, which will hurt the economy if firms put off investment plans. He is an advocate for an early referendum. I believe that the sooner this matter is resolved, the better it will be for business certainly and investment in Europe and Britain.”
“Other members of the EU should not see a request for renegotiation from Britain in a completely negative way. It should be seen as an opportunity for reform across the EU but not on exclusive British terms. We all have an interest in this debate. All political institutions are subject to mission creep by political and administrative elites. That’s especially the case in the EU. But this debate on EU reform must not be simply about the UK.”
“Some national parliaments, including Ireland’s, are failing to exercise the extensive rights of participation in decision making now available to them under EU treaties. There is still a democratic deficit at the heart of the EU. I believe the EU parliament which is the only fully democratic EU institution should take a central role in the negotiations on British membership and reform of the EU.”
“I believe Ireland will also have a very important role to play in these coming negotiations. We can be bridge of interpretation between the two sides. Relations between Britain and Ireland are closer than ever before. There is a particularly warm political friendship between David Cameron and Enda Kenny. These things matters. It is in Ireland’s clear interest that negotiations between Britain and its EU partners are brought to a satisfactory conclusion and the referendum is carried in favour of continuing British membership of the EU.”
“Britain alone against the world still exercises a very powerful tug on the English imagination. However as Mark Carney rightly pointed out- “The EU is the largest economy in the world. It is Britain’s largest investment destination. It is the largest investor in the UK.” David Cameron’s broad demands that the EU be competitive, flexible and accountable will resonate in many other countries. I believe that the British PM is personally committed to Britain remaining in the European Union. He made that point very clear in his Bloomberg speech when he said, “Britain’s national interest is best served in a flexible, adaptable and open European Union and such a European Union is best with Britain in it.”
“Polling evidence in the UK, insofar as polls have any credibility after the recent election, is indicating majority support for staying in the EU. The Better Together campaign was successful in the Scottish referendum last year. A similar style campaign on Britain’s EU membership is also likely to succeed when the time comes. But time is of the essence.”
“Britain does face a dilemma however. The EU is not static; it is an ongoing process of integration, creating an ever closer union. This process will not stop. The Eurozone, of which Britain is not a member, is accelerating a process of co-ordination and deeper integration among its nineteen members. In effect a two tier Europe is already in place.”
“Continuing membership of the EU will at some stage involve further treaty changes. When this happens, Irish voters will have their say by way of referendum. Perhaps the only long term solution to Britain’s ongoing difficult relation with the EU is to give to British voters the same rights to have their say as Irish voters have. In the meantime Britain’s negotiations with its EU partners will get the closest possible attention from the Irish government. It would be a disaster for Ireland, North and South, if Britain decides to leave to EU. While we have no vote we certainly can help in the negotiation with other EU colleagues. We should concentrate on that in the time ahead.”