Bruton stands firm on corporate tax

MINISTER for Enterprise, Jobs and Innovation, Richard Bruton, said the Government would stand firm against any attempt by Europe to insist on a change in the 12.5% corporation profit tax as a condition for easing the terms of the €85 billion bailout.

“My view is that the corporation tax regime is absolutely fundamental to the Irish model. I think we have to look at what the challenge is that Europe faces at the moment,” he said.

He was speaking at the announcement of an €8.8 million investment in the Tralee-based Altobridge by Intel Capital and the investment arm of the World Bank in Dublin last week.

Mr Bruton said that the challenge for Europe is that it needs to see countries like Ireland being in a position to trade their way out of the difficulties it faces.

“In our case this is going to be an export-led recovery and the idea that they would seek to remove one of the most important pillars of our policy is just misguided.

“Ireland will have to defend this absolutely rigorously. This is a very important element of our approach to the development of enterprise in a peripheral location,” he said.

It is “short-sighted to think that an export-led recovery could be developed on the basis of diluting that commitment,” he said.

The resolution to the problems facing Europe are going to be founded on a recovery driven by companies like Altobridge, he said.

“We understand that Europe needs to see a balanced package emerge and Ireland has signed up to that,” he said.

“We are a sovereign country sharing our sovereignty in order to achieve greater things, and of course there will be give and take when it comes to working out a pack,” he said.

However agreeing to the CPT regime being changed is not on the agenda, he stressed.

Dick Spring, the former Labour Party leader who is chairman of Altobridge and also a public-interest director in AIB, said he believed the current stress testing of the Irish banks “will draw a line” under the ongoing saga concerning the solvency of the Irish banks, whose collapse triggered the €85bn EU-IMF bailout.

But he added: “I think the important thing at the moment is not to pre-empt the stress testing.”

He said he believed that when the process is completed at the end of the month Ireland and Europe will finally know the true position regarding our banks.

He refused to be drawn on speculation that another €20bn in funding might be needed.

“We have to restore confidence (in the banks) and I think there is a bigger solution to be found in the European context.

“Until the stress tests have been completed and we see the cards put out on the table then we will decide on our strategy going forward.”

Until that happens we are speculating “and we all know where speculating brought us”, he said.