Fine Gael has denied there a serious rift between senior party figures over whether or not Europe should have a role in domestic taxation policy. Mr Jim Mitchell, the deputy leader and finance spokesman described the difference between his views and those of Mr John Bruton, the former leader, as one of "nuance".
Mr Bruton appeared to support the concept this weekend when he criticised a speech opposing European tax harmonisation made on Friday by the Tánaiste and Progressive Democrat leader, Ms Harney.
The PD leader said there were no circumstances under which Ireland would cede fiscal autonomy to Europe.
Using a phrase borrowed from Baroness Thatcher - former British premier and eurosceptic - she said: "Ireland is not for turning on this issue."
Mr Bruton described the Tánaiste's speech as subliminally anti-EU and a grave over-simplification, while Mr Mitchell said he was in total agreement with Ms Harney.
"I agree with her that taxation is a matter of national competence. The party leader, Michael Noonan, said so in his address to the ard fheis last weekend," said Mr Mitchell last night. He said his position was also the party position. "We are not for tax harmonisation - we are opposed to it," he said.
Mr Mitchell said it was not unusual that the party's initial response to Ms Harney's speech had come from Mr Bruton rather than from him in his role as the party finance spokesman. "I don't believe in controlling the thoughts of every member," he said.
The former party leader's comments acknowledged the importance of co-operation between EU states but also added the caveat that "low tax rates are, of course, important and high rates should not be imposed on us by high spending governments elsewhere".
Mr Bruton warned in a statement issued by the Fine Gael press office that "the Tánaiste should know that Ireland's present prosperity would disappear if the euro was to fail because of insufficient co-operation on monetary and fiscal policy, because of the activities of populist politicians like her- self".
Last Friday Mr Bruton was appointed vice-president of the convention on the future of Europe. The body, which was established by the member states, meets for the first time on Thursday and a number of the larger states are expected to try and get the issue of tax harmonisation on the agenda. Ireland's low corporation tax regime is a concern to other states, particularly Germany.
The Progressive Democrat leader set out her stall on the subject in an uncompromising manner last Friday at the Institute of Taxation annual dinner. "There are no circumstances in the short, medium or long term in which Ireland will cede our fiscal autonomy to EU institutions," she said.
Mr Mitchell said last night there was an inherent contradiction in the Tánaiste's position.
"You can only have low taxes if you have low spending. The Government of which she is deputy leader allowed spending increase by 22 per cent last year," he said.
