ECOFIN Meeting To Discuss 'Eurotax'

by Ulrika Lomas, for LawAndTax-News.com, Brussels

16 November 2004

At a meeting of European Union Finance Ministers which commenced last night, the contentious issues of the terms of the Stability and Growth Pact and the funding of the European Union are being discussed, according to reports.

Speaking ahead of the meeting, observers suggested that it was unlikely that the 3% of gross domestic product (GDP) cap on budget deficits for eurozone members would be increased, despite problems faced by countries such as France, Germany and Greece.

However, writing in the Financial Times on Monday, Economic and Monetary Affairs Commissioner, Joaquin Almunia hinted that some changes were likely, observing that:

"A union of 25 cannot afford a 'one-size-fits-all fiscal policy given the differences between the structures of each country's economy."

Also under discussion is the possibility of imposing a 'eurotax' as a way of funding the European Union between 2007 and 2013.

According to the EU Observer news service, the Dutch presidency confirmed this, announcing that "the future introduction of a eurotax and changes to the so-called VAT call rate" would be discussed by the EU Finance Ministers.

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