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| Version 4 | Version 5 |
|---|---|
| Irish government rules out raising corporation tax | Irish government rules out raising corporation tax |
| (7 days later) | |
| The Irish government has insisted it will not raise the country's low corporation tax rate in return for a European Union-led bail-out. | The Irish government has insisted it will not raise the country's low corporation tax rate in return for a European Union-led bail-out. |
| Deputy Prime Minister Mary Coughlan said the 12.5% rate - much lower than the EU average - was "non-negotiable". | Deputy Prime Minister Mary Coughlan said the 12.5% rate - much lower than the EU average - was "non-negotiable". |
| Her comments come as speculation grows that France and Germany want Dublin to raise the tax in return for aid. | Her comments come as speculation grows that France and Germany want Dublin to raise the tax in return for aid. |
| Meanwhile a bank at the heart of the crisis, Allied Irish Banks, said 17% of its deposits had flown this year. | Meanwhile a bank at the heart of the crisis, Allied Irish Banks, said 17% of its deposits had flown this year. |
| The Irish government is in bail-out talks with officials from the EU, the European Central Bank and the IMF. | The Irish government is in bail-out talks with officials from the EU, the European Central Bank and the IMF. |
| Bank woes | Bank woes |
| Although the Irish government claims to be fully-funded until the middle of next year, it has provided a blanket guarantee to the Irish banks, some of whom are now finding it impossible to borrow money in the markets. | Although the Irish government claims to be fully-funded until the middle of next year, it has provided a blanket guarantee to the Irish banks, some of whom are now finding it impossible to borrow money in the markets. |
| Allied Irish Banks (AIB) said that businesses and institutions accounted for most of the 13bn euros ($18bn, £11bn) deposit flight, implying that the bank does not face a run by ordinary depositors. | Allied Irish Banks (AIB) said that businesses and institutions accounted for most of the 13bn euros ($18bn, £11bn) deposit flight, implying that the bank does not face a run by ordinary depositors. |
| AIB's admission is another sign of a steady loss of confidence in the Irish banks that has forced them to become increasingly reliant on the European Central Bank and the Irish Central Bank to refinance their debts. | AIB's admission is another sign of a steady loss of confidence in the Irish banks that has forced them to become increasingly reliant on the European Central Bank and the Irish Central Bank to refinance their debts. |
| The bank said it intends to raise 6.6bn euros by issuing new shares, although in the current market environment the Irish government is the only investor likely to buy them. | The bank said it intends to raise 6.6bn euros by issuing new shares, although in the current market environment the Irish government is the only investor likely to buy them. |
| Imminent deal | Imminent deal |
| An aid package is expected to emerge next week, according to an unnamed source quoted by the Reuters news agency. | An aid package is expected to emerge next week, according to an unnamed source quoted by the Reuters news agency. |
| It will coincide with, or follow shortly after, the announcement by the Irish Republic of a new four-year austerity programme. | It will coincide with, or follow shortly after, the announcement by the Irish Republic of a new four-year austerity programme. |
| On Thursday, the Irish government admitted for the first that it needed outside help. | On Thursday, the Irish government admitted for the first that it needed outside help. |
| Finance Minister Brian Lenihan said he felt "no sense of shame" over the country's economic record, but that it now needed outside help. | Finance Minister Brian Lenihan said he felt "no sense of shame" over the country's economic record, but that it now needed outside help. |
| Previously the government had said it did not need any financial support from the European Union and International Monetary Fund (IMF). | Previously the government had said it did not need any financial support from the European Union and International Monetary Fund (IMF). |
| 'Predatory' | 'Predatory' |
| The Republic's low corporation tax has been criticised by other EU nations, who argue that it gives the country too much of an advantage in attracting overseas investment. | The Republic's low corporation tax has been criticised by other EU nations, who argue that it gives the country too much of an advantage in attracting overseas investment. |
| They now argue that the Republic should not be allowed to solely rely on a bail-out, and that it should instead raise the tax rate to help boost government funds. | They now argue that the Republic should not be allowed to solely rely on a bail-out, and that it should instead raise the tax rate to help boost government funds. |
| The Financial Times on Friday reported a French official describing it as "almost predatory". | The Financial Times on Friday reported a French official describing it as "almost predatory". |
| However, the Republic's European Minister Dick Roche, also insisted that the corporation tax rate was "certainly not up for negotiation". | However, the Republic's European Minister Dick Roche, also insisted that the corporation tax rate was "certainly not up for negotiation". |
| He told the BBC: "There has been some very unhelpful chatter in the background in the last few days about our corporation profit tax. | He told the BBC: "There has been some very unhelpful chatter in the background in the last few days about our corporation profit tax. |
| "Where would be the sense of destroying one of the great drivers of growth?" | "Where would be the sense of destroying one of the great drivers of growth?" |
| EU, European Central Bank, and IMF officials arrived in Dublin on Thursday to discuss the country's debt crisis, and what aid the country required. | EU, European Central Bank, and IMF officials arrived in Dublin on Thursday to discuss the country's debt crisis, and what aid the country required. |
| The Republic's Central Bank Governor, Patrick Honohan, said he expected a loan in the region of "tens of billions" of euros. | The Republic's Central Bank Governor, Patrick Honohan, said he expected a loan in the region of "tens of billions" of euros. |
| Finance Minister Mr Lenihan said the country's problem were caused by its heavily indebted banks, which the government has had to bail-out to the cost of 45bn euros (£39bn; $60.1bn). | Finance Minister Mr Lenihan said the country's problem were caused by its heavily indebted banks, which the government has had to bail-out to the cost of 45bn euros (£39bn; $60.1bn). |
| "The big difficulty of course is that the banks grew to such a size that they became too unmanageable for the state itself, that's the big difficulty here," he said. | "The big difficulty of course is that the banks grew to such a size that they became too unmanageable for the state itself, that's the big difficulty here," he said. |
| "And that's why we have to consider external assistance to stabilise our banking system." | "And that's why we have to consider external assistance to stabilise our banking system." |