Austria floats EU tax plan as MEPs reject budget
ANDREW RETTMAN
18.01.2006 @ 18:13 CET
EUOBSERVER / BRUSSELS - The EU should be fed by its own tax instead of member states' donations, the Austrian presidency said on Wednesday (18 January), while telling MEPs they are unlikely to get much over €1 billion extra for 2007-2013 spending.
"Europe needs stronger own resources," Austrian chancellor Wolfgang Schussel indicated, adding "if we don't tackle this issue, then reaching agreement on the next financial perspectives will be under threat."
He hinted the tax could target short-term financial investors, air-travel and maritime transport, but said it will be the European Commission's job to come up with a detailed proposal that "will cause the least pain."
The chancellor explained that the current finance system was already under stress in a Europe of 12 members back in the 1990s, but is untenable in a Europe of 25 or 27.
"The old days are gone," Mr Schussel said.
A spokesman for UK prime minister Tony Blair quickly responded that London has "strong reservations" about any EU tax plan and that it is too early to moot reforms now ahead of a planned budget review in 2008.
But French diplomats reacted warmly, saying "We should have an open mind in the discussion on how the future undertakings of the EU can be met. This might include a new European tax."
Poland might also be ready to discuss an European tax a few years down the line, another EU diplomat remarked.
Parliament rejects budget
Turning to the 2007-2013 EU budget, Mr Schussel told MEPs "there's a certain room for manoeuvre" on the €862 billion agreed by member states last month, adding the extra figure is "something like €1 billion."
His remarks came moments before 541 MEPs rejected the 2007-2013 budget, opening the door to fresh spending negotiations between parliament, the commission and member states.
Parliament had previously asked for €975 billion, while budgets committee head Janusz Lewandowski reminded EUobserver that MEPs squeezed an extra €4 billion out of member states in a similar situation in 1999.
French, German and British diplomats agreed with Mr Schussel that the financial elbow room is "very narrow" this time around however.
An EU official also told EUobserver that the six net payers to the EU budget - Germany, France, the UK, Austria, the Netherlands and Sweden - set aside around €1 billion to appease parliament as far back as the beggining of 2005.
"It was always clear something should be prepared for parliament," the contact said. "If Schussel said €1 billion, then in the course of negotitions it will be a little more but nothing like €3 or €4 billion."
Structure more flexible
But if the size of the cash pie will be hard to increase, parliament might have more of a say in the way it will be chopped up when the negotiations with member states begin on 23 January.
EU officials said parliament will have the most freedom in channeling more money into the competitiveness, citizenship and foreign policy sections of the budget.
The move could mean several million euro extra for EU programmes covering competitiveness, research, education, media and immigration as well as development aid for EU neighbours and overseas countries.
Austria's Mr Schussel singled out competitiveness as a key area where member states' allocations could be improved, saying "More money will be made available for that. I am 100 percent certain."
The chancellor predicted the talks will end before July.