IRELAND’S FAVOURABLE CORPORATION tax rate could be at risk from Germany’s demand that the country make some concessions in return for a reduction on interest paid for the EU/IMF bailout.

Following a two-day summit of EU finance ministers in Hungary, Germany’s finance minister Wolfgang Schaeuble said that Ireland must make some changes in return for any adjustments to the bailout package, RTÉ reports.

He told reporters at the end of the summit:

If Ireland, for its part, doesn’t want to make any changes, then there is no willingness on the side of the governments to make changes.

Schaeuble later alluded to the issue of the  tax rate and said that it was important to establish: “a common approach to calculating corporation tax.”

The Sunday Independent also reports today on fears that Noonan will be forced to give into demands for an adjustment on Ireland’s low corporation tax rate of 12.5 per cent in return for an interest reduction mooted to be around 1 per cent on the €85 billion bailout deal.

The comments of Schaeuble follow discussions between Noonan and his French counterpart Christine Lagarde on Friday which were described as ‘good’.

Any reduction on Ireland’s interest rate will likely follow the agreement of a bailout package for Portugal which requested assistance last week.

The process of agreeing a deal is likely to take around six weeks.