IRELAND Law and Practice Contributed by: Amelia O’Beirne and Trevor Glavey, A&L Goodbody
1. Sources and Principles 1.1 Domestic Sources of International Tax Law The Irish system of taxation is principally governed by a combination of domestic Irish legislation and Euro - pean Union (EU) law. Legislation governing taxes in Ireland includes: • the Taxes Consolidation Act 1997 (TCA); • the Stamp Duties Consolidation Act 1999; • the Capital Acquisitions Taxes Consolidation Act 2003; and • the Value-Added Tax Consolidation Act 2010. As a member state of the EU, Ireland is subject to EU law, both primary and secondary, including EU trea - ties, regulations and directives, together with deci - sions, recommendations and opinions issued by EU institutions. This includes, for instance, judgments of the Court of Justice of the European Union (CJEU). In terms of the scope and structure of Ireland’s tax treaty network, Ireland has currently signed compre - hensive double taxation agreements (DTAs) with 78 countries, of which 75 are in effect. Ireland’s DTAs cover direct taxes, which in the case of Ireland are: • income tax; • universal social charge; • corporation tax; and • capital gains tax. Ireland’s membership of the Organisation for Eco - nomic Co-operation and Development (OECD) and its commitment to participate in the implementation of OECD tax initiatives also shapes the development of Ireland’s tax laws. In terms of other sources, Ireland’s tax authority, the Revenue Commissioners (“Revenue”), publishes extensive guidance on the interpretation and applica - tion of Ireland’s tax laws. Such guidance is, however, not binding on taxpayers or the Irish courts. 1.2 Hierarchy of Sources Subject to the following, the Irish Constitution takes precedence over other, inferior sources of law in Ire -
land. Accordingly, a common law rule or piece of leg - islation that conflicts with a provision of the Constitu - tion can be invalidated on the basis that it is repugnant to the terms of the Constitution. Ireland’s accession to the EU necessitated an amend - ment to the Constitution to ensure that EU law enjoys supremacy in Ireland. Accordingly, in areas where the EU has competence, EU law prevails over a conflicting domestic provision. The terms of a ratified DTA con - cluded between Ireland and a DTA partner jurisdiction can also override domestic provisions. As a common law jurisdiction, decisions of an Irish court (other than decisions of the Tax Appeals Com - mission (TAC)) have precedential value in Ireland and are binding on taxpayers unless overruled by a deci - sion of a superior court (or a subsequent legislative amendment). As noted in 1.1 Domestic Sources of International Tax Law , the same applies with respect to decisions of the CJEU. Decisions of foreign courts are only of persuasive authority in Ireland. 1.3 OECD Model/United Nations Influence on Treaty Practice As a small open economy, Ireland benefits from globalisation and DTAs are important in facilitating engagement with key economic partners. Ireland’s long-standing tax treaty policy has been to expand, maintain and enhance Ireland’s tax treaty network in order to remove barriers and facilitate trade and investment opportunities between Ireland and partner countries. In pursuance of this policy, and as noted in 1.1 Domestic Sources of International Tax Law , Ire - land currently has comprehensive DTAs in place with 78 countries, of which 75 are in effect. When negotiating DTAs, Ireland generally seeks to align as closely as possible with the OECD Model Tax Convention (MTC). In this respect, in June 2022 Ire - land published a Tax Treaty Policy Statement which makes clear that one of Ireland’s objectives for DTAs is to incorporate OECD minimum standards and best practices, aligned with the positions adopted by Ire - land in the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI), into new and existing DTAs.
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