Prodi Says EU States Need Common Tax Surplus Policy

by Ulrika Lomas, Tax-News.com, Brussels

30 January 2002

Speaking at a conference in Milan on Monday, European Commission President Romano Prodi suggested that EU member countries should create common rules on the use of tax surpluses in order to ensure good economic management on a Union-wide level.

'The objective is to develop coordinated economic efforts that...above all, make it impossible to commit the sort of manifest errors that, in the eighties, brought us to the brink of instability,' he observed. The idea of a common code of economic conduct was first raised by the EC President in November, but he gave no specific details at that time.

Mr Prodi went on to warn those attending the conference at Bocconi University that the current Stability and Growth Pact, which is designed to rein in budget deficits in the eurozone, is not necessarily enough to ensure good economic policy throughout the region.

'The Stability and Growth Pact focuses on the short term, but the main problem is the long-term sustainability of public finances, which is threatened by the aging of the population,' he explained.

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