Ireland’s Corporation Tax rate, an economic bone of contention for some of our European Union partners, has been stoutly defended by South MEP Colm Burke.
This followed comments made last week by German Christian Democrat MP Otto Bernhardt who said that any German supported EU ‘bail-out’ of Ireland would come with conditions, cut our corporation tax among them.
Interviewed by Reuters last Thursday, Mr Bernhardt stated: “We would look very closely at past sins. We will not tolerate there being low-tax countries like Ireland for example. We will insist on a minimum corporate taxation rate.”
He said that any assessment of the Eurozone clearly illustrated that Ireland “was in the worst [economic] situation of all”, with Greece the next worse off Member State.
Reading between the lines, this seemed to indicate Mr Bernhardt’s belief that Dublin’s difficulty was Berlin’s opportunity, though he later denied any such sentiment.
In reaction Mr Burke (Fine Gael) didn’t mince his words, describing Mr Bernhardt’s comments as “outrageous”.
The German MP’s comments carried some weight on the markets, with the Euro falling against the Dollar later that day.
However, Mr Burke believed the comment had been made possible due to “the abysmal failures of our Government” which had “opened the door to such an opportunistic attack on this country’s fiscal policies”.
Added Mr Burke: “It is because the Irish economy is now so vulnerable and so reliant on multi-billions of borrowings that this German politician feels emboldened enough to hold out the prospect of a financial rescue plan for Ireland at the price of losing our vital Corporation Tax rate
“It is not enough for the Irish Government to dismiss this outrageous claim by the German MP, it must also demonstrate to both the Irish people and our EU partners that we have a comprehensive economic and fiscal plan to tackle our current economic crisis.”
Colm Burke said there were “no circumstances” in which Ireland could cede its 12.5 per cent Corporation Tax rate.
“We must, however, also take the tough decisions that get our public finances in order and to convince the international money markets that this country has a credible and effective plan to overcome the current difficulties,” he said.
Speaking to reporters at the Brussels EU summit following Mr Bernhardt’s remarks, the Taoiseach said that the German MP’s claims were “incorrect” and carried “no basis”.
Meanwhile, Mr Burke has called on the Government and the EU to offer further support to the Irish dairy industry.
Speaking at Fine Gael’s South Tipperary AGM last Friday, Mr Burke said dairy farmers across Munster and the entire country find themselves in an “unsustainable” position.
“Dairy farmers are being asked to accept prices from co-ops that are significantly lower than their production costs. This has damaged the confidence of the industry and threatens its survival never mind its development…
“Co-ops should examine all possible means to cut their own costs, including reviewing salaries to senior management and fees to outside contractors, without cutting ordinary jobs which are the lifeblood of the rural economy.
“Dairy farmers should not be expected to carry the full burden on their own. The Government and the EU must also look at ways of boosting the industry.”