German Finance Minister Peer Steinbruck launched an attack on Ireland's low corporation tax and threatened to take up the case with the European Commission, Irish media reports said Saturday, according to DPA. Speaking at a meeting of the Group of Eight (G8) industrialized nations near Berlin on Friday, Steinbruck said corporate tax laws were being exploited in countries like Ireland, which has the second lowest rate in the EU at 12.5 per cent. "Corporate tax laws such as those in Ireland are being exploited by German companies that set up subsidiaries there, borrow money from them and then write off the interest against their profits in Germany," the Irish Examiner quoted Steinbruck as saying. Current EU president Germany has said it wants to harmonize taxes across the European Union. The corporate tax rate in Germany is currently the EU's highest at 38.6 per cent. Ireland's low corporate tax rate is widely seen as contributing to the economic success of the once failing EU economy over the past deacde. In 2004, for example, Ireland, with a population of just over 4 million, attracted as much investment as Germany, a country of over 80 million. Ireland's leadership has rejected the German proposals for harmonized taxation. Dublin could also veto the final proposal when it reaches the commission.
