Ireland’s finance minister, Paschal Donohoe, told CNBC on Friday that the nation is looking to reach a compromise over global taxation that recognizes “the role of legitimate tax competition.”

His statement follows the G7 finance ministers’ agreement this month to set a minimum corporate tax rate of 15% worldwide, which was suggested by US President Joe Biden’s administration. Ireland’s corporate tax rate of 12.5% is one of the lowest in Europe.

“What we are going to do is engage in the OECD [Organisation for Economic Co-operation and Development] process very intensely across the coming weeks and months and I do hope an agreement can be reached that does recognize the role of legitimate tax competition for smaller and medium-sized economies,” said Donohoe.

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The G7 plan is under discussion at the OECD level and will also be discussed between the G20 leaders next month in Venice, Italy. Once implemented, the plan will make it more difficult for corporations to set up operations abroad, where tax rates are often dramatically lower. The US, for example, charges a flat corporate tax rate of 21%, which Biden has proposed hiking to 28%. (RT)