The German chancellor, Gerhard Schroeder, has added his voice to calls for greater harmonisation of taxation within the European Union.

In an interview for the British newspaper the FINANCIAL TIMES, Mr Schroeder said it would be sensible in a single European market, with a single European currency to have greater tax co-ordination.

He said there would never be complete harmonisation but he stressed that his finance minister, Oskar Lafontaine, had the backing of the German government when he demanded moves in that direction.

Mr Lafontaine has also proposed ending national vetos on EU tax matters -- a move opposed by Britain.