A Whitehall official told City A.M.: “We won’t agree to anything that surrenders control over tax policy.”
It is understood that France and Germany are pushing the EU to speed up efforts to coordinate corporate tax rates across the 27-member bloc. Britain and Ireland – which have competitive rates of the tax – are opposed to the proposals.
David Cameron sent Anglo-European relations into a tailspin in December after he vetoed an EU treaty because he could not secure safeguards for the financial services sector.
Nigel Farage, leader of the UK Independence Party, said: “The [EU] must believe Cameron will cave into their demands – or they want Britain out of the EU for good.”