The influence of the EU in Ireland's tax affairs is growing, with more measures and complexities coming down the tracks
The EU has become a key driver of change in terms of Irish and international tax, said Andrew Quinn, Dublin head of tax at Maples and Calder, the Maples Group's law firm.
"Irish companies are facing significant new EU-led tax legislation and rules," said Quinn. "It is a stark contrast from a few years ago when the EU had a much more limited role in tax matters."
While we have already come through a period of significant changes, there are more to come. "The tax environment that companies are operating in is becoming increasingly complex," said Quinn. "There are many new EU tax measures coming down the tracks. In fact, I expect that from this point onwards, Ireland will be seeing annual EU tax changes to give effect, for example, to OECD tax measures and green tax initiatives.
"The Apple case is the most obvious example of the EU's influence and the first time it came onto the public's radar generally," said Quinn. The European Commission ruled in August 2016 that Apple had received unfair tax incentives from the Irish government under so called State Aid rules. Both Apple and the Irish State appealed against the original ruling, saying the iPhone maker's tax treatment was in line with Irish and EU law.
We are also in the middle of implementing the EU Anti-Tax Avoidance Directive (ATAD) - an anti-tax avoidance project that has been agreed by OECD countries. ATAD sets out several action points, and within the EU it was felt that this should be done in a coordinated way. "The directive is now being implemented right across the EU, including Ireland," said Quinn. "The Finance Bill 2019 contains some measures in this regard, and more will follow in the next year. With an EU directive it has force of law, rather than just being a cooperative project as it is outside the EU, so it is very important that member states implement it properly."
The EU is also updating its whistleblower legislation. "They have included protections for employees if they report an arrangement of the employer whose purpose is to obtain a 'tax advantage'," said Quinn. "This is extremely broad and shows the reach the EU now have in terms of taxation." Another big story for Ireland is the potential new global minimum tax - GloBE. This is based on something that the US implemented under Trump - a minimum tax on "global intangible low-taxed...