IRELAND: Ireland told to shore up corporate tax laws to prevent wealthy from committing tax fraud and evasion

UN’s top human rights watchdog says measures ‘must be strengthened’ so loopholes cannot be exploited to hide profits.

The UN’s most senior human rights watchdog has told Ireland to shore up its corporate tax policies as they are hindering efforts to ensure wealthy individuals and businesses are not exploiting loopholes to hide profits.

The UN’s Economic, Social and Cultural Rights Committee has published a report following a two-day hearing in Geneva last month during which Minister of State Joe O’Brien and his officials were questioned on a number of issues.

The committee has said it is “concerned” with reports that financial secrecy legislation and lax corporate tax rules “continue to hinder” the ability of Ireland and other states to meet their obligations.

It called on Ireland to “strengthen measures to combat illicit flows, cross-border tax evasion, and tax fraud, in particular by wealthy individuals and business enterprises operating or domiciled in the state party’s jurisdiction”.

Furthermore, it said Ireland must “take all necessary measures to avoid a situation which allows for shell companies to be used for profit-shifting, tax evasion and fraud by, inter alia, strengthening its legal framework and measures for the protection of whistleblowers”.

It also called on Ireland to conduct an “independent and comprehensive assessment” of the impacts of its national and international tax policy on the economies of developing countries and to report on the findings.

Following publication on the report, Christian Aid Ireland head of policy and advocacy Conor O’Neill said: “Ireland’s role in enabling corporate tax avoidance has long been a glaring blind spot.

“Ireland has played a central role in some of the most egregious and high-profile tax avoidance structures in the world, and it’s often poorer countries who lose out.

“As a development organisation, we see this impact starkly; money is lost that should be paying for hospitals and schools, prolonging a reliance on aid and keeping people trapped in poverty.”

Dr Gearóid Ó Cuinn, director of the global legal action network, said it is “extremely rare” for UN human rights committees to directly raise concerns about the impacts of tax policies abroad, and pointed out this has now happened twice in little over a year for Ireland.

“The independent experts have clearly recognised the incontrovertible evidence that Ireland’s tax policies are undermining basic rights in impacted countries by hindering access to healthcare and education,” he said.

“It is now clear that Ireland is bound by international law to co-operate with other states, amend its policies and work to end harmful corporate profit-shifting.”

The UN committee expressed further concern about the “growing income disparities” in Ireland, and “the fact that certain transfers do not reach the population segments that they were intended to benefit”.

The committee also expressed concern that the gender pay and pension gaps “persist due to vertical and horizontal gender segregation in the labour market, as well as the over-representation of women in part-time and low-paid work”.

While welcoming the announcement of the introduction of a national living wage by 2026, the committee said the minimum wage “remains insufficient to ensure a decent living for workers and their families”.

On housing, it expressed concern about the “persistent gap between housing supply and demand and the increasing cost of rental housing disproportionately affecting those most marginalised and disadvantaged”.

“The committee also notes with concern that the lack of social housing has forced households to move into the private rental sector, which is not adequate in terms of affordability, habitability, accessibility and security of tenure.”