DUBLIN — As EU experts dug through the books of Ireland’s debt-crippled banks, the question moved from whether Ireland will take an international bailout to under what conditions.
On the firing line was Ireland’s prized low business tax, which the government says has lured 1,000 multinationals to Ireland over the past decade — but which it may have to give up to satisfy conditions of being rescued.
The Irish rescue is the latest act in Europe’s year-long drama to prevent mounting debts and deficits from overwhelming the weakest members of the 16-nation eurozone. Greece was saved from bankruptcy in May, and analysts say Portugal could be next in line after Ireland for an EU-IMF lifeboat.
Officials on all sides cautioned that the Dublin talks could stretch on after Ireland clarifies its plans by publishing a four-year outline for slashing$20.5 billion from its deficit — forecast this year to reach 32 percent of economic output.
The Irish government said the planwill be published by Tuesday — but won’t include any change to its 12.5 percent rate of corporate tax.
Officials in Germany, France, Britain and Austria argue Ireland should be prepared to raise that rate. They say it’s not fair for Ireland to receive aid from EU partners while sticking to a tax policy that amounts to unfair competition.
