O’Keeffe to use Irish veto as 12.5 per cent corporate tax rate under fire
ENTERPRISE Minister Batt O'Keeffe has promised to veto any threat to Ireland's 12.5 per cent corporate tax rate following the European Commission's shock decision to publish proposals on tax reform.
Asked if the Government would take the nuclear option and veto any attack on our corporate tax rate, the minister said: “Yes, we will use the veto if necessary.”
The minister's commitment is likely to torpedo renewed EU efforts to twist Ireland's arm into dropping its opposition to a common corporate tax rate within Europe.
“I am heading to North America with the IDA next month, promoting Ireland as a location for multinationals,” said Mr O'Keeffe. “On my last visit to the States, we had to give the US companies assurances that there would be no change in the tax rate.
“The last thing we need is this latest development. Our statements to US investors will be virile and strong. The 12.5 per cent rate is a constant and will not change”
Mr O'Keeffe pointed out that he had several allies. “Already, 12 countries have lined out against harmonisation, so we do not expect to need the veto.”
The minister's hostility to the new proposals follows uncharacteristically outspoken opposition to the commission's move from the US Chamber of Commerce last week.
In a thinly veiled reference to the troubles with Anglo, chamber president Lionel Alexander warned the Government that its need for European assistance elsewhere in the economy should not influence it to make concessions on the tax issue.
“We expect the Government to vigorously oppose any moves in this regard,” Mr Alexander said.
More than 100,000 people are directly employed in more than 600 US firms here, accounting for over 70 per cent of IDA-supported employment. According to the Chamber, US firms paid over €3bn to the Exchequer in 2008.
Finance Minister Brian Lenihan is due to be briefed by European Taxation Commissioner Algirdas Semeta about the proposals on Monday week.