August 09, 2010

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Brussels feels time is right to suggest EU tax As the economic downturn sees many member states seek ways of cutting back on public spending, the European Commission believes the time is right to put the thorny idea of the EU raising its own taxes back on the table. EU budget commissioner Janusz Lewandowski told German daily Financial Times Deutschland that the feelings on the idea of an EU tax had changed in national capitals. “Many countries want to be unburdened. In this way, the door has been opened to think about revenues that are not claimed by finance ministers,” he said. If the EU raised its own taxes, then member states could pay less to the EU from their national budgets is the thinking in Brussels. Member states currently pay towards the EU budget based on gross national income, as well as VAT and customs duties. However, these sources only make up about 12 percent of EU revenue. “The national credit transfers in 1988 were only 11 percent, now they account for 76 percent of our revenue,” said Mr Lewandowski. “That was not the intention of the founding fathers.” “If the EU had more of its own revenues, then transfers from national budgets could be reduced. I hear from several capitals, including important ones like Berlin, that they would like to reduce their contribution,” he added. He indicated that possible tax sources for Brussels could include an aviation tax and a financial transaction tax. Mr Lewandowski also has his eye on the money raised from the auctioning of CO2 emissions rights, something due to start in 2013.

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