Markets Wired

As prepared for delivery

I want to thank the American Chamber of Commerce Ireland, for hosting us, and of course, I want to thank Minister Donohoe, for your warm introduction – and, more than that, for your friendship and honest counsel over the past ten months.

As with administrations before it, the Biden-Harris Administration is committed to preserving and strengthening the U.S.-Irish bond, between our governments and between our people.

And these ties extend to our businesses as well. Today, over 900 U.S. companies have established roots here – with many making Ireland their European and international headquarters.

As this group knows well, these U.S. companies directly employ over 180,000 people in Ireland and another 140,000 indirectly, while investing around $6 billion in capital expenditures in Ireland every year. U.S.-Irish trade and investment is a two-way bridge that continues to benefit both countries tremendously.

This strong partnership between our countries has proven absolutely necessary in understanding each others’ positions in the recent negotiations on international tax.

As we all know, on October 8, in a remarkable testament to both the potential of multilateral cooperation among nations, and the vision of countries like Ireland to adapt to a changing world, 136 countries – representing nearly 95% of the world’s GDP – agreed to rewrite the international tax rules to impose a 15% global minimum tax on corporate foreign earnings, thereby taking a once-in-a-generation step that will end the race to the bottom on corporate taxes.

Minister Donohoe – I remember how during one of our first meetings you told me that I could walk down Grafton street and ask any Irish person, “What’s your country’s corporate tax rate?” – and I would very likely get the correct answer. 

Minister Donohoe, you’ve helped me understand how the corporate tax rate is a touchstone issue here in a way that it isn’t almost anywhere in the world.

But what I’ve found more remarkable these past few months, is Ireland’s capacity to adapt. Indeed, I think it’s a testament not only to you, Minister Donohoe – but to the Irish people – that you saw the world for what it was, where it was headed, and what it needed, and therefore saw that it was time for change. 

Countries agreed that the post-pandemic world must be fairer, especially with regard to international taxation. We understood the need to have stable tax systems that provide strong incentives for businesses to invest while raising sufficient revenue that allow us all to invest in essential public goods, respond to crises, and ensure that all citizens and corporations fairly share the burden of financing government.

The OECD/G20 international tax agreement includes strong provisions that will buttress and police the system, incentivizing countries to join and remain within it, and helping to sustain minimum taxes around the world.

And under this global system, with its multilateral enforcement tools, large multinational corporations will pay their fair share in Ireland, just as they will in the rest of the world.

And through this process, Minister Donohoe, your leadership on behalf of Ireland to ensure it was not left behind in this process has frankly been extraordinary.

So the United States and over 130 other countries are truly grateful that Ireland came forward to support the OECD/G20 Inclusive Framework Agreement. The agreement will help ensure fairness for middle class and working people not just in Ireland and the United States, but around the world.

And it will help the global economy thrive by leveling the playing field for businesses and encouraging positive competition among countries, competition judged by the talent and education of a nation’s workforce and the quality of its physical and technological infrastructure.

And, indeed, the global minimum tax will help fund investments in those critical priorities.

With its robust business environment, Ireland is already winning this new race to the top. 

That is some of what this agreement will do for the whole world, including Ireland. But of course, the crucial question in this audience, “What will it do for Ireland in particular?”

Well, here is my honest assessment of what it WILL NOT do: It won’t change this country’s status as one of the best places to do business in the world.

As I mentioned, there are hundreds of U.S. companies with real roots in Ireland. Was the corporate tax rate one reason they came? I would have to imagine yes. But it was not the only reason, and it wasn’t the reason they stayed, or the main reason they are here now.

And I and my Treasury colleagues hear that regularly. You are here because of the caliber of the workforce, the strength of the business environment. This deal doesn’t change any of that. 

In fact, this new tax deal will bring certainty to your companies, including those which have been challenged in recent years by a chaotic array of unilateral digital tax measures, in a context in which the status quo simply could not be maintained.

Rather than acting in a world of tax uncertainty, when this deal is fully implemented, companies will again be able to plan and make investment decisions in a more stable environment.

We thus appreciate Ireland’s partnership in getting this agreement over the line. And the United States will also continue to be a reliable partner on the wide array of economic and financial topics that provide benefits to business.

And we will work together to achieve a sustained and equitable global economic recovery from the pandemic, and continue to cooperate in addressing an array of transatlantic and global economic and financial issues.

President Biden likes to quote Irish poets and while it turns out Seamus Heaney and Yeats didn’t write much verse about international tax regimes, they did write often about friendship. “Think where man’s glory most begins and ends,” Yeats wrote, “and say my glory was I had such friends.”

It is the United States’ great fortune to have a friend such as Ireland. And I think that all of our companies, on both sides of the Atlantic, will continue to benefit from that friendship for many, many years to come. 

I look forward to hearing from the business community represented here today, your perspective on the international tax agreement, and how we can ensure it is implemented in a manner that benefits governments, businesses, and the wider public.