Tuesday, August 10, 2010

Open Europe press summary: 10 August 2010



Commission's plans for EU tax strongly rejected by Germany and UK

There is widespread coverage of EU Budget Commissioner Janusz Lewandowski's plans to table proposals for a direct EU tax in September, which would mean member states handed over less money from national treasuries. He suggested that, "There are various options that would not affect the finance ministries and have a link to European policy like a financial transaction tax, CO2-emission auctions and an aviation scheme," which could be used to directly finance the €140bn a year EU budget.


Treasury Minister Lord Sassoon said the British Government "is opposed to direct taxes financing the EU budget. The UK believes that taxation is a matter for member states to determine at a national level and would have a veto over any plans for such taxes."


FT Deutschland notes that the German government also flatly rejected the proposals. "The call for the introduction of an EU-tax is in contradiction to the position of the federal government as anchored in the coalition agreement," a spokesman said. The coalition contract between the governing parties states that "We reject an EU-tax or the involvement of the EU in national tax and duty collection." The spokesman confirmed that "Nothing has changed in this stance". In a separate article the FTD writes that the strong rebuff from Berlin is a severe setback for Lewandowski, who was hopeful of German support.


A spokesperson of the Austrian Finance Minster Josef Pröll told the paper that "we view the announcement by Lewandowski positively". BN/De Stern reports that the parties forming the new Dutch government have opposed the tax.


Under the headline, "EU tax, no thank you!", Chief Correspondent of German tabloid Bild Einar Koch argues that, "The EU desperately needs structural reforms in its expenditures instead of new sources of revenue". Belgian daily Het Nieuwsblad comments: "In the end it is again the citizens who will have to pay...If the European tax would not be compensated for (by reducing national taxes), than the growing legion of eurosceptics will only receive more ammunition to fire at Europe." MEP Derk-Jan Eppink, who is backing a pan-European campaign against an EU tax, said that the proposals should be fought "with fire and sword," according to Standaard.


Open Europe is quoted in the Telegraph saying, "The Commission seems to think that because of the tough economic climate, national governments would be keen to let Brussels collect money for the EU budget directly, rather than handing it over from national budgets...Imposing an EU tax would be an unmistakable move to a federal Europe, which, time and again, the public has said it doesn't want." Open Europe was also quoted in the Express.

Open Europe blog Telegraph Mail WSJ Guardian FT Reuters BBC Express EUobserver AFP Les Echos Le Point European Voice Nouvel Observateur City AM El Mundo EFE ABC El Economista El Mundo Nieuwsblad Standaard BN/De Stem Bild Bild: Einar Koch Welt: Wergin FTD 1 FTD 2


Government confirms EU President costs taxpayers €6m a year in wages and expenses

In reply to a written question from independent Labour Peer, Lord Stoddart of Swindon on the cost to taxpayers of the newly created EU Council President Herman Van Rompuy, Lord Astor of Hever, for the Government, confirmed that the annual cost is "€6m (£4.98m), including staff, travel expenses and salary".

Parliament: written questions


Law Professor: We need to be more active in resisting the EU's political court

In the Guardian, Birkbeck College Law Professor Michelle Everson argues that "The most curious feature of the European Court of Justice (ECJ), the court of the European Union, is not that it is a political court, but rather that it has until very recently been so successful in pursuing its political programme of the integration of Europe through law without attracting much public or even expert notice."


Everson adds, "In the UK, then we should be drawn to ask why ECJ politics have now become so important and what impact they might have on our social, economic and political constitution...For me, UK legal resistance towards the unpopular politics of the current ECJ would not be an anti-European act. Instead, it might just be the saviour of European law."

Guardian: Everson


German Economics Professor: Germany "pulled over the table" in eurozone bailout negotiations

Writing in FT Deutschland, Mannheim University Economics Professor Rolan Vaubel states that Germany "let itself be pulled over the table" in agreeing to the €750bn eurozone bailout. He writes that the bailout and breach of the EU treaties has shaken German trust in the European Union, adding, "the federal government - and at its forefront the chancellor - did not cut a good figure and were publicly pulled over the table." Vaubel concludes that the bailout should be a case for the European Court of Justice, but argues that since the judges share the Commission's interest in the centralisation of Europe, they also almost always share the same interpretation of the law. "This means it is now time to reform the ECJ fundamentally. The judges should be delegated by the highest courts of the member states."

FTD: Vaubel


MEPs can claim for Viagra at taxpayers' expense

The Sun reports that Brussels officials and politicians are entitled to free Viagra on their EU health insurance. The article also notes that, under the European Commission scheme, it is even possible for them to claim for heroin replacement methadone, if needed. Last year it was revealed that MEPs get public funding for massages and feng shui. Other perks which qualify include mud baths, hydromassage and mild electric shock treatments.



France renews calls for an EU "emergency force" in wake of Russian wildfires

In an interview with Le Figaro, French Europe Minister Pierre Lellouche has reiterated his support of the creation of an EU disaster reaction force in the light of Russia's wildfires. "At the European level, it would be good to have real means of mutual aid in case of emergency. Following the earthquake in Haiti, I emphasised to our European partners the need to pool our means to create a European emergency force. It still does not exist", he argued.

EUobserver Le Figaro


Writing in the IHT, Paul Taylor asks "has the [eurozone] crisis gone away, or is it just taking a summer siesta?", noting that, "The economic imbalances and sharp differences in competitiveness between northern European euro-zone states, led by Germany, and Mediterranean countries remain unresolved."

IHT: Taylor IHT: Vinocur Comment is Free: Blejer and Yeyati


ECB concerned that new banking rules could pose risks to eurozone

City AM reports that the European Central Bank (ECB) announced yesterday that planned changes to capital requirement rules could make it too easy for banks to offload risky assets on the ECB. The ECB warned that definitions of what can be classed as 'appropriate capital' could allow commercial banks to dump risky assets, such as asset backed securities (ABS), increasing risks to the eurozone.

City AM


ORF reports that the second stage of the EU ban on incandescent light bulbs will enter into force from 1 September, as 75 Watt bulbs are to be taken off the market. On top of that, extensive packaging rules will be added in order to promote energy saving light bulbs.



An article in the Express reports that the UK dairy industry has criticised the Green group in the European Parliament's attempt to ban farmers from labelling their milk as 'fresh' if it has a use-by date of seven days or more.



The WSJ reports that due to shrinking budgets, a lack of political will and national rivalries, European space projects are faltering and funding is being cut. The article notes that: "The lack of momentum is a dramatic shift from the situation two years ago...[when]... the EU for the first time explicitly linked space efforts to broader diplomatic and foreign-policy goals".



EUobserver reports that Iceland's EU accession talks have become strained at an early stage, with the Commission warning it could block access for Icelandic and Faroe Islands fishermen to EU waters if they do not back down on plans to boost their mackerel catch.



Open Europe is an independent think tank campaigning for radical reform of the EU. For information on our research, events and other activities, please visit our website: openeurope.org.uk or call us on 0207 197 2333.