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Last Updated: Wednesday, 18 January 2006, 14:10 GMT
Austrian leader calls for EU tax
Wolfgang Schuessel
Wolfgang Schuessel: Tax gaps are 'absurd'
Austrian Chancellor Wolfgang Schuessel has called for a form of European Union tax to help end regular disagreements over the Union's budget.

Speaking to Euro-MPs in Strasbourg, Mr Schuessel said the idea would not be popular but it was necessary.

Mr Schuessel, whose country holds the EU presidency, suggested an EU levy on short-term financial transactions or international aviation.

He said it was no longer possible for member states to provide all EU funds.

'Unhappy tension'

A deal on the EU's next long-term budget was agreed by the British EU presidency in December, but only after months of bitter wrangling.

It's my task as president in office to make necessary proposals even if they are unpopular
Wolfgang Schuessel
Mr Schuessel said a direct funding system would enable the EU to get away from the current "unhappy tension" between net contributors to the EU budget and net recipients.

"The idea of a... self-financing system is not popular everywhere but it's my task as president in office to make necessary proposals even if they are unpopular," he said.

He urged European Commission President Jose Manuel Barroso to look at the idea during a fundamental review of EU revenues and spending to be conducted in 2008.

"It's absurd that today short-term financial transactions are completely exempted from tax. It's absurd that there are tax gaps - that international aviation is part of a tax gap," he said.

Constitution debate

Mr Schuessel also repeated that the Austrian presidency wanted to re-open the debate on the European constitution, which was rejected by French and Dutch voters last year.

This wasn't just a text, he said, but a question of European identity.

He also said that the crisis over Russian gas supplies to Ukraine had produced a growing consensus on the need for a common EU energy policy.

"It's a question of reducing our dependence on one supplier," he said.


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