Friday 19 July 2019

Exclusive audio: 'My European tax plans are not anti-Irish,' insists Juncker

EC president says there will be no changes without our consent - and Good Friday Agreement must be protected

European Commission President Jean-Claude Juncker Picture: Reuters
European Commission President Jean-Claude Juncker Picture: Reuters

Stephen Rae in Strasbourg

Jean-Claude Juncker has insisted his plans to drive forward tax harmonisation are not "anti-Irish", in an exclusive interview with the Irish Independent.

The president of the European Commission said there would be no interference with our tax rates without the consent of the Irish Government.

In comments that will be seen as crucially important to Brexit negotiations, he claimed the Good Friday Agreement was an EU victory that must be protected. That sense of EU ownership over the peace process will delight Irish diplomats and signals a potentially more co-operative approach to the vexed question of the Irish Border in Brexit talks.

Earlier this week, Mr Juncker had stoked fears for Ireland's economic well-being when he called for a radical shake-up of EU rules that would strip individual countries of the right to block changes to tax law.

The head of Ireland's Fiscal Advisory Council, Seamus Coffey, said the move to introduce a Common Consolidated Corporate Tax Base (CCCTB) would be "more serious" than Brexit for Ireland. However, in his only interview with Irish media, Mr Juncker appeared to modify his stance - admitting he's already come under attack in his home country of Luxembourg over the controversial proposals.

"When it comes to taxation, because that was your question, I was proposing if the European Council did so, by unanimous decision, to change the voting rules in the European Union when it comes to taxation. But if you have unanimity or qualified majority voting, this is not ... this does not mean that these things could be done without debate," he said.

INM Group Editor-in-Chief Stephen Rae with Jean-Claude Juncker
INM Group Editor-in-Chief Stephen Rae with Jean-Claude Juncker

"In a debate, the argument of the 'wants' and that of the others have to be listened to carefully. So there is not an anti-Irish thing because already ... in Luxembourg papers are writing... saying qualified majority could be taking place. No. I want us to have the debate and then the vote, not the opposite."

The proposals set out in Mr Juncker's State of the Union speech in Strasbourg would mean EU tax law could be changed via so-called qualified majority voting (QMV) among member states. It is part of a push to implement sweeping changes to the way corporate taxes are levied. Currently, all countries must agree before EU tax laws can be changed.

That has been a bone of contention, as Ireland repeatedly outmanoeuvred French and EU moves to attack the 12.5pc tax rate. A move to QMV would end the ability to block changes.

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Acknowledging the role Irish tax policy played in the recovery here, Mr Juncker expressed admiration for the speed and scale of the economic turnaround.

"Never in history has this happened," he said. "I'm really impressed by the way the Irish government, parliament and the people were trying, under difficult conditions, to come out of the situation they were in."

On the Border, the usually outspoken Eurocrat was noticeably circumspect, a sign of the sensitivity the issue is being treated with in Brussels.

"I don't want to put in danger the Good Friday Agreement - which was a major achievement of European, and British and Irish policy making during the second half of the 1990s. And we have to know that this is an issue we should not deal with in a superficial way because it's a demanding issue."

Asked if the British government would ever get its act together on the Brexit negotiations, he replied: "I'm not in charge of Britain or London. I never was by the way."

He praised the work of Michel Barnier, the EU commissioner in charge of Brexit, in relation to negotiations on the Irish Border. "I wouldn't like us to re-experience what the Republic and the North had to go through in recent decades," he said.

"I have full confidence in the elegant way Michel Barnier is dealing with that question and he is considering this question as being of high importance."

Irish Independent

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