State denies move on corporation tax
Published 15/04/2011 | 05:00
THE Government was forced last night to deny the corporation tax rate was on the table after the French government claimed there will be "movement" in talks on the contentious issue.
French Finance Minister Christine Lagarde heaped further pressure on the Government by making the damaging claim in Washington.
The French want the 12.5pc corporation tax rate raised in return for a reduction in the interest rate on the bailout.
Speaking in Washington, Ms Lagarde claimed "there will have to be movement" on Irish corporation tax. Finance Minister Michael Noonan spoke with Ms Lagarde last week at a meeting of EU finance ministers in Budapest.
The Government says it will talk about common rules on the application of corporation tax across the EU. But while ministers will discuss the EU common consolidated corporate tax base, it will not debate the tax rate. However, Ms Lagarde stressed the need to address both the base and the rate of corporation tax.
Ms Lagarde said that the Irish had "very much benefited" from low corporate tax and that the rest of Europe found this was "not a very cooperative practice" as the country had a competitive advantage.