Debate on global corporate tax will not ‘diminish’ Irish-US relations - Neal

Ireland should not fear changes to corporate tax rate, Democratic congressman tells IIEA

US Congressman Richard Neal said: “The disruption that is occurring over the [Northern Ireland] Protocol is something that should have been predictable” . Photograph: Clodagh Kilcoyne/Reuters

US Congressman Richard Neal said: “The disruption that is occurring over the [Northern Ireland] Protocol is something that should have been predictable” . Photograph: Clodagh Kilcoyne/Reuters

 

Potential disagreement over an upcoming push to set a global minimum tax rate from the Biden administration will not “diminish” Irish-US relations, Democratic Congressman Richard Neal has said.

The US is reported to have settled on a proposal for a minimum global corporate tax rate of 15 per cent, during talks with the OECD.

The moves to introduce a minimum rate would threaten Ireland’s current 12.5 per cent corporate tax rate, which is seen as key to attracting large multinational companies to locate in the country.

Speaking at an online talk organised by the Institute of International and European Affairs (IIEA), Mr Neal said he did not think Ireland had anything to worry about from the tax proposals.

“The relationship between Ireland and the United States will not be diminished because we have a discussion about tax policy, that is for sure,” he said.

The Democratic congressman chairs the powerful House ways and means committee, and was involved in the Northern Ireland peace process. He is also the chairman of the Friends of Ireland caucus group in Washington.

Ireland had a “very assertive position” when it came to corporate tax, but it also had a highly educated workforce, and was a “gateway to Europe” due to its location, he said.

Large multinational companies “shopping” for low-tax destinations was “unhelpful” to the global economy, he said.

Companies moving “from one jurisdiction to another for the purpose of avoiding tax” needed to be tackled, Mr Neal told the event.

Brexit

The prominent Democrat was critical of those who pushed for Britain to leave the European Union, with promises the transition would be simple.

“The champions, the Brexiteers, they told everybody this was going to be easy, that this was going to be simple, that their divorce from European Union would not come attached with any economic woes,” he said.

“One of the challenges that Brexit brought about was the threat to the Border in the North of Ireland,” he said.

The Irish-American congressman repeated the US administration’s stance that the Brexit process could not be allowed to threaten the peace won by the Belfast Agreement.

“The disruption that is occurring over the [Northern Ireland] Protocol is something that should have been predictable,” he said.

Mr Neal said given recent turmoil in the fallout from Brexit, President Joe Biden should consider appointing a special envoy to Northern Ireland.

Speaking about a potential future Border poll, Mr Neal said he thought a referendum on unity was “inevitable”. However, he said it would be up to nationalists to “convince unionism that they have no threat to their identity in an united island.”

The congressman said the “shadow” of former president Donald Trump still loomed large in the Republican Party. He criticised the spread of “crazed” conspiracy theories, which frequently gained huge traction on social media.

Mr Neal also joked that while Mr Biden had well known links to Ireland, he had “great confidence” that the Irish would soon find some ancestral roots for vice-president Kamala Harris as well.