Tom Fleming (Kerry South, Independent)

This proposal is a strategy by the bigger powers in the EU such as Germany and France; they are playing games to get at our 12.5% corporate tax rate through the back door.

The 12.5% rate is vital for our existence in terms of competing on a level playing pitch, particularly in the context of the current economic crisis. We export more than 80% of everything we produce and have a huge export market in sectors such as consultancy and, ironically, financial services.

I welcome the recent declaration by the Taoiseach that he will oppose attempts to increase the corporation tax rate through the back door. It has been reported in other political circles that Ireland is prepared to engage in discussions but we cannot enter negotiations without knowing the implications for our 12.5% tax rate and the revenues that accrue from it. That door should not be left even half open. The details of these proposals have not been fleshed out and we cannot agree to anything that would be detrimental to our interests. As the Lisbon treaty gives each member state full control over its domestic tax rates, all 27 member states would have to agree before changes can be made and individual states can exercise a veto over proposals. We will have to be vigilant in this regard.

Given the success of the 12.5% tax rate, we should if anything reduce it to give the economy a badly needed stimulus. The Government should consider reducing it to 10% because we need to think outside the box and take positive measures that will help us resolve our crisis. No country could oppose such a reform in light of our current predicament.

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