EU president strikes down idea of European tax

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The president of the European Union struck a major blow Tuesday to the concept of a Europe-wide tax, proposed last month by the European Commission but opposed by heavyweights France and Germany.

"I do not think that redesigning the way the EU gets its revenue is a top priority," Herman Van Rompuy said in a speech in Berlin.

"I am personally open to new ideas, but since most alternative sources of income would risk hitting member states unequally, this would weaken the fairness of the current system, its built-in solidarity.

"So let's be prudent, but let's discuss it," added the president.

In October, the European Commission proposed the creation of a Europe-wide value-added tax as part of reforms to fund the EU's budget from 2014-2020.

But the plans ran immediately into howls of protest from Europe's biggest, and richest, states, including Britain, France and Germany, whose leader Chancellor Angela Merkel was present at the speech.

Reacting to the proposals from Brussels, French minister for Europe Pierre Lellouche said the idea of a European tax was "perfectly ill-timed," saying the goal should instead be to "make savings" in Brussels.

© 2010 AFP

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