Business World

Sunday 23 April 2017

EU plans to keep closer eye on national budgets

Donal O'Donovan and Brendan Keenan

IRELAND and other eurozone countries will have to accept much closer surveillance of their national budgets, the Irishwoman who heads the EU Commission said yesterday.

Catherine Day, secretary general of the commission, said it was in the interests of member states that the EU took a more active role in monitoring countries' fiscal positions.

"There is no doubt whatsoever that there will be a big step forward in the economic governance of the eurozone at least," she told a meeting in the Institute for International and European Affairs (IIEA) in Dublin.

"The commission will be much more involved in policy-making of the member states and we want that to be seen as helpful in preventing problems arising, rather than as intrusive."

Earlier, Ms Day told a business briefing organised by the Ireland For Europe lobby groups that bringing the public finances back under control was a necessary starting point for economic recovery. "There is no sound economic policy without that," Ms Day said.

She suggested Ireland should consider its priorities carefully before negotiations begin on the EU budget over the next 10 years.

The Government would also have to "analyse carefully" proposals on corporation tax that the commission will produce next year, although these will recognise that tax rates are a matter for national governments.

The EU's Internal Market Commissioner, Michel Barnier, who was also in Dublin yesterday, told members of the Joint Oireachtas on EU Affairs in Leinster House that he would like to see Ireland participate in moves to harmonise the way in which corporation tax is calculated in different countries.

Streamlined

He said that did not mean agreeing to common corporate tax rates, which would require the unanimous support of all members, including Ireland.

The commissioner said he would like to see the VAT systems across the EU co-ordinated and streamlined, but again did not call for a common rate.

Mr Barnier said Ireland had the tools to recover from the economic crisis. "I am confident there is light at the end of the tunnel. The Irish character, competitiveness and readiness to adapt to change means the country has what it takes to win in the long term," he said.

Irish Independent

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