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27th Jan 2023

Commissioner defends 'unfashionable' EU tax idea

  • Mr Lewandowski (c) is said to be very close to the Polish government, which will kick off the EU 2014 to 2020 budget talks during its EU presidency in late 2011 (Photo: ec.europa.eu)

The Polish commissioner in charge of the EU budget, Janusz Lewandowski, has said an EU levy on the financial sector has the best chance of winning support after France joined the UK and Germany in opposition to plans for creating an EU tax.

"Talking about EU own resources and something with the shape of a European tax is extraordinarily unfashionable. But I see a tendency, that it is possible in terms of public opinion to defend a tax on financial transactions or another form of tax on the financial sector. It would even be popular," he told the Polish press agency, PAP, on Tuesday (10 August).

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Mr Lewandowski noted that he is looking to raise about €30 billion to €40 billion a year from the new revenue source in order to keep EU spending levels at no less than the current rate of €140 billion a year in the 2014 to 2020 period.

He said EU financial ministers are encouraging the European Commission to explore new revenue options despite a public backlash against the EU tax idea by the bloc's biggest member states.

"They are telling the commission: keep looking, maybe you will find something, so long as it lets us reduce payments from state budgets," Mr Lewandowski told PAP.

"This motivates me to look for new revenue sources, because I know what kind of impasse we will hit in budget talks if they are to mean larger donations from Paris, Berlin, London or other capitals. This is why it's worth looking for new solutions and taking a risk."

France on Tuesday joined the UK and Germany in criticising the notion of a new EU levy, recently floated by Mr Lewandowski in the German press.

"We think this idea of a European tax is completely inopportune. Any kind of supplementary tax is today unwelcome. It is rather a time for making savings both in member states and the European institutions," the French junior minister for EU affairs, Pierre Lellouche told Agence France Presse.

"Clearly the idea of a European tax, the power to levy taxes, raises fundamental political issues and would be a very significant transfer of sovereignty," he added.

The Lewandowski gambit comes amid deep cuts in national spending by many EU states in reaction to the eurozone debt crisis, creating antagonism to any extra transfer of money to Brussels. A financial transaction tax would hit a sector held morally responsible for the global financial crisis in 2008, which led to the EU's current age of austerity, however.

Poland and Belgium are the only EU countries so far to come out in favour of the new EU levy.

Poland's EU affairs minister Mikolaj Dowgielewicz told PAP on Tuesday that Warsaw would welcome a debate on the subject, so long as the tax would not target ordinary citizens and would not be linked to CO2 emissions trading rights.

"But it's not to be excluded that we would accept other variants. That's why I would warn others against excessive criticism," he said.

Belgian junior minister Melchior Wathelet was unequivocal in his backing. "With a mechanism of own resources, it [the EU budget] would be more fair," he told the Belga news agency.

Belgium, as the current holder of the rotating EU presidency, and the home country of EU Council President Herman Van Rompuy, is in a good position to put the tax idea on the agenda of EU finance ministers in September, when Mr Lewandowski aims to put forward a formal proposal.

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