ITI Reassures Over Lisbon Treaty

by Jason Gorringe, Tax-News.com, London

10 August 2009

President of the Irish Taxation Institute, Jim Ryan, on July 30 reassured Irish taxpayers and enterprises that the Lisbon Treaty, if approved, would not interfere with Irish tax policy, and that its 12.5% corporation tax rate – vital to its international competitiveness – would remain intact. The Lisbon Treaty will be subject to another referendum on October 2, 2009, having been rejected previously.

“The Lisbon treaty that will be put to a vote by the Irish people later this year does not affect our ability to set our own tax policy,” underscored Jim Ryan, President of the Irish Taxation Institute. “The re-negotiated Treaty includes a specific guarantee on taxation. This new guarantee is crystal clear in stating that nothing in the Lisbon Treaty makes any change to the EU’s competence with respect to taxation and, in particular, the right of Member States to set their own corporation tax rates. This position is further confirmed by decisions of the European Court of Justice. A subsequent Treaty revision would be required to alter this position, which would undoubtedly require approval of the electorate in a referendum.”

“During last year’s Lisbon referendum, there was much controversy and confusion in relation to Ireland’s tax veto, and the Irish Taxation Institute carried out detailed analysis of the Treaty in respect of its impact on taxation which determined that the veto was unaffected by the Treaty. The specific guarantees obtained by the Irish government in advance of the second referendum further consolidate that position. In relation to taxation, Ireland has nothing to fear from the Lisbon Treaty,” Ryan concluded.

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