France drops plans to push tax harmonisation


French finance minister, Christine Lagarde: tax proposal "alive, but not kicking very much."
TAX PROPOSAL: FRANCE SAYS it is dropping plans to push forward with tax harmonisation under its European Union presidency, following Ireland's rejection of the Lisbon Treaty.

Christine Lagarde, French finance minister, told the Financial Times that while the proposal for a common consolidated corporate tax base had not been abandoned altogether, Paris would no longer press other governments to back it over the next six months.

"It is on the agenda, but we are not pushing it," said Ms Lagarde in an interview. "It is alive, but not kicking very much."

The relegation of the tax base proposal - a long-standing French objective - is the first sign the Irish No vote is having a knock-on effect on the EU's policy agenda, particularly on those issues deemed to encroach on national sovereignty.

"The landscape has slightly modified because of good old Ireland," Ms Lagarde said, while insisting that "the imperatives are the same".

Irish Times Thursday 19/6/08 BEN HALL in Paris

http://www.ireland.com/newspaper/ireland/2008/0619/1213810561773.html

Latest Dangerous French plans on Corporate Tax laid bare

Fears as French to push for tax-rate harmony

Irish Independent
Saturday June 07 2008
Harmonisation of business taxes will be the number one priority of the French Presidency of the European Commission, which begins next month, officials from the French Department of Finance told business leaders.

A meeting of Medef, the largest French business lobby group, was told that Nicolas Sarkozy's government plans to bring forward concrete measures aimed at harmonising the European corporate tax base and, by extension, all tax rates, as early as September.

This would seem to undermine assurances given by Jose Barosso, the president of the European Commission, on a visit to Ireland last April when he said that Ireland's tax rates would not be threatened.

There is also evidence that the European Commission may be deliberately hiding plans to harmonise corporate tax rates until after Ireland goes to the polls on the Lisbon Treaty.....

The Irish Independent has seen copies of the agenda prepared for the July 2 meeting of the European Commission's 'Competitiveness Council'. It shows the plans have now developed to the point that Laszlo Kovacs, the EU Commissioner for Taxation and Customs Union, and the main driver of the tax harmonisation plans, was due to give a presentation on the subject to the Council...........

Turlough O'Sullivan, director general of business lobby group IBEC, said: "I am absolutely convinced this is a Trojan horse to bring in common tax rates."

Ireland can veto the proposals, whether or not the Lisbon Treaty is passed by next Thursday's referendum. However, this would not stop some countries using the "enhanced cooperation" mechanism of the EU to club together to harmonise their own tax bases.

Critics of the plan say Ireland would be then be pressurised to join this group.

- Tom McEnaney Business Editor

http://www.independent.ie/national-news/fears-as-french-to-push-for-taxrate-harmony-1401314.html