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As talks to form the new German coalition government continue, LYMEC (the European Liberal Youth) is very concerned that proposals to put pressure on the Irish government to raise their corporation tax rate form part of the discussions.

It has been reported in the Irish media that the SPD would only back external funding for Irish banks if its government’s opposition to a financial transaction tax is reversed and its corporation tax was increased from 12.5%. The Irish government itself has yet to have a substantive role in this specific area of negotiation.

Although stability in the Eurozone is of paramount importance, LYMEC believes that member states should have sovereignty over tax rates, and that the Irish government should have ultimate control over its own taxation policy.

LYMEC hopes that a new government can be formed in Germany that does not seek to impose minimum tax rates on other nation states, and that any move to the harmonisation of tax rates is made on a multi-lateral, diplomatic basis through the European Union and not in the domestic corridors of Berlin.

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