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Germany's Schäuble Calls For EU Petrol Tax

by Ulrika Lomas,, Brussels

18 January 2016

Germany's Finance Minister, Wolfgang Schäuble, has floated the idea of a surcharge on sales of gasoline in the European Union to help member states cover the costs of accommodating political asylum seekers.

Schäuble said in an interview with Süddeustche Zeitung on January 16 that if insufficient funds are currently available in national budgets to meet the challenges of the migration crisis and securing the external borders of the Schengen area, the extra money could be provided by an EU-level tax.

"I've said if the funds in the national budgets and the European budget are insufficient, then let us agree to set up, for instance, a tax on a certain amount on each liter of gasoline," Schäuble said. "We have to secure Schengen's external borders now. The solution to these problems must not founder due to a limitation of funds."

Schäuble went on to suggest that if the EU could not agree on the idea of such a levy, then a "coalition of the willing" would represent an acceptable compromise.

Confusingly, however, the Finance Minister appeared to reject calls for a separate EU-level tax in a speech given two days earlier during a symposium entitled "The Future of EU Finances" in Brussels saying that there is "no need" for new sources of revenue.

"It has been argued that a new source of revenue like an EU tax is necessary to provide more money for Europe. This sounds like a convincing argument but it is not correct," he said.

He added that: "As I said at the beginning of my speech, I have sympathy for a bigger revenue autonomy for the Union in principle. However, in the current system, there is no need for new sources of revenue like an EU tax to provide additional money for Europe."

The prevailing opinion within Schäuble's own Christian Democrat Party appears to be that additional taxation, in Germany at least, is not needed thanks to the favorable budgetary situation. Provisional data for 2015, presented by the Finance Ministry on January 13, revealed a structural budget surplus for a second consecutive year, of 0.1 percent of gross domestic product, or EUR12.1bn (USD13.5bn).

TAGS: Finance | tax | budget | oil and gas | Germany | Europe

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