Popular initiative launched against introduction of EU taxes

An initiative was launched by the Taxpayers Association of Europe to prevent the possible introduction of new EU-wide taxes in a bid to boost the bloc’s budget for the next seven-year financial period.

Launching the campaign yesterday, the Taxpayers Association of Europe, together with a number of MEPs, said an online petition was being raised against any suggestions to introduce common EU taxes.

The aim of the NOEUTAX.EU petition is to raise one million signatures from the 27 member states and hand it over to the European Commission under the European Citizens Initiative. The initiative is a new mechanism under the Lisbon Treaty, which allows EU citizens to ask the Commission to propose a new law or abandon legislation if a million citizens from at least seven member states sign up to the initiative.

Although the Commission has not yet come out with its tax proposal, European Commission president Josè Manuel Barroso has already declared the EU Executive will be proposing the introduction of direct EU taxes in order to boost the budget (2014-2020) while easing the pressure on individual member states.

However, the Commission’s initiative, expected to be formally launched by the middle of this year, has not gone down well with many member states, including Malta, which have objected to the introduction of direct taxes on EU citizens.

On the other hand, some member states, particularly those that contribute most to the EU coffers, like Germany, France and the UK, are contemplating some form of harmonised direct taxation.

Contributions towards the EU budget are made up of direct payments by individual member states according to their gross domestic product. Some revenue from VAT and Customs duties are also sent to the Brussels coffers.

During the launch of the petition, British Conservative MEP Geoffrey Van Orden, one of the promoters, said he strongly opposed any move towards common taxation at EU level as this would mean a move towards a federal Europe.

“If we succeed, the European Commission is obliged to listen to us. Moreover, we would be able to demonstrate an unmistakable lack of public support towards EU policy makers,” he said.

According to the secretary general of the Taxpayers’ Association of Europe, Michael Jaeger, the EU should efficiently spend the money already at its disposal rather than look for new ways to increase taxation.

“We do not need more revenue streams but more efficiency in spending the present EU budget. What would be the added value of a new EU tax? Now you have a balanced budget on a EU level but with new taxes, you expose yourself to a threat of falling into the debt trap the moment you have lower revenues,” Mr Jaeger said.

The Commission is expected to unveil its proposals on the eve of the next round of negotiations on the 2014-2020 budget. These proposals are normally followed by acrimonious negotiations between the 27 member states on who will be paying and getting the funds.

According to EU rules, member states whose average annual GDP is under 75 per cent of the EU average will be eligible for most of the funds. It is not yet clear whether Malta will fall in this category when the negotiations are expected to be concluded some time in 2013.

During the negotiations on the current budget (2007-2013), Malta secured a package of more than €1 billion of EU funds to be used in various projects.