Europe will target Irish corporation tax, warns DUP

DEMOCRATIC UNIONIST Party MPs last night warned that Ireland will face major pressure from EU states such as France to increase…

DEMOCRATIC UNIONIST Party MPs last night warned that Ireland will face major pressure from EU states such as France to increase corporation tax in next year’s treaty negotiations, despite guarantees given last year.

Rejecting charges that the UK is now “marginalised and isolated”, DUP North Belfast MP Nigel Dodds said: “Many of those who say that were of course the very same people who, at one time, not so long ago, were urging us to join the euro. They castigated the euro realists who dared to point out the in-built defects of the euro project. They made the same dire doom-laden predictions. But they were wrong then and they are wrong now,” he told the House of Commons.

In Denmark and Sweden, he said, there are already signs that they may not support a possible treaty of 26 member states, while the Polish government may face insurmountable obstacles to get an agreement past its two parliamentary chambers. “Even in France there is no consensus – yesterday the Socialist contender in the presidential elections, François Hollande, made it clear that he would seek to negotiate a new agreement if elected because he opposes the loss of French budgetary sovereignty,” he said.

Responding, foreign office minister David Lidington said it is “no secret” that Ireland had faced “enormous pressure” to concede on corporation tax during last year’s bailout talks, adding the British government had given “steadfast support to the Irish resistance to that move”.

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Despite support for David Cameron from Conservative MPs on Monday, many of them are now worried he is preparing to backtrack, following signals that he will allow the other 26 to use EU institutions to operate a new treaty.

Interrupting Mr Lidington, Conservative MP Anna Main said the British public did not expect the use of the institutions to be allowed: “If that is not the case, then many will believe that we have been sold a pup.”

Responding to a question from Conservative MP John Redwood, Mr Lidington said discussions about the use of the European Commission and the European Court of Justice to operate the treaty “are at an early stage”.

Demanding a referendum on EU membership, Mr Dodds said: “I believe that for too long there has been a determination on the part of the political and diplomatic elites in this country to deny any say to the people on this issue.”

Meanwhile, the Liberal Democrats are set to get a greater role in developing ties with the other EU states following a cabinet meeting at No 10 Downing Street during which differences between the Conservatives and their smaller coalition partners were aired once more. Deputy prime minister Nick Clegg insisted that the UK should not bar the rest of the EU the use of the Brussels institutions.