France likely to use veto on Irish rate cut

IRELAND faces a fight to have its bailout interest rate cut after France insisted that Irish corporation tax be increased firstly.

Those close to the efforts to convince French President Nicolas Sarkozy to agree to the cut said: “The French are digging in. They will use their veto.”

Finance Minister Michael Noonan told the French he would not concede on corporation tax, saying it was responsible for Ireland’s export-led growth. He was willing to forego the saving on interest repayments of between €148 million and €200m a year.