The European Commission’s push for common rules which would see companies pay tax where they make sales, rather than where they are based – a move that could damage Ireland’s attractiveness to multinationals – is “not history”, a senior commission official has said.

The push for a common consolidated corporate tax base was first put on table two years ago after a decade of preparation, Philip Kermode, director of the commission’s directorate-general for taxation, told an Oxford University conference.

Progress on the issue is currently in the hands of the Irish EU presidency, which “must regard this as a somewhat poisoned chalice”, said Mr Kermode, who is one of Ireland’s highest-ranked officials in the commission.

The creation of a common consolidated corporate tax base (CCCTB) would not create equal corporate tax rates throughout the EU but would allow firms to comply with an EU-wide system for computing their liabilities.

Concrete action
Ireland, the UK and the Netherlands, oppose a CCCTB, while doubts about it exist elsewhere, but Mr Kermode said the European Council had demanded "concrete actions – no more theory, please, concrete actions" on taxation.

“We have no corporate tax harmonisation, per se: this proposal is not a proposal to harmonise corporate taxes, but what it has done is to open a very detailed discussion at che Council about the elements of a tax base.

“It does appear to us now that there is a certain amount of push towards continuing discussion on a so-called step-by-step basis which concentrates first on the base,” Mr Kermode told the Oxford University Centre for Business Taxation conference.