France Stands Firm, Refuses To Cut Ireland’s Bailout Interest Rate

christine lagarde

The French government is still refusing to cut the bailout loan interest rate for Ireland unless they raise their taxes, according to the Irish Times.

It was expected that Ireland would get some sort of cut on its interest rate as soon as Monday’s European finance ministers conference. But French Finance Minister Christiane Lagarde appears to be digging in over the issue of Ireland’s corporate tax. Now a deal on Monday does not look likely, according to the Irish Times.

Ireland’s corporate tax is at a low 12.5%, and it is considered one of the main drivers of investment and growth for the country. Recent jobs legislation excluded a hike in the corporate tax rate, and instead proposed a tax on pensions.

While France has been opposed to an interest rate cut without a tax hike, Germany has been much more open to the possibility.

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