“In order to set the stage for enhanced tax co-ordination, France and
Germany express their support for the European Commission’s proposal on a
common system of financial transaction tax,” the paper said.
In order to push the EU towards greater tax “harmonisation”, Germany
and France will, later this month, announce proposals to harmonise their
corporate tax rates.
Britain has been always hostile to commission plans for an energy tax
directive and a “common consolidated corporate tax base” because
both are seen as eroding national sovereignty opening the door giving to the
EU setting taxation rates.
EU officials have said that the Franco-German push will give a new lease of
life to Brussels for new energy taxes that will set higher minimum road and
heating fuel duties based on carbon emissions.
British and other European industries are concerned that the legislation will
lead to increases in the level of duty on red diesel, damaging
competitiveness during a recession.
Eurogas, which represents the European gas industry, concerned because the
commission proposals would set a minimum tax rates for natural gas at “eight
and half-fold higher than the current levels”.
Douglas Carswell, the Conservative MP for Clacton, said that tax competition “is
a vital way of ensuring dynamism and competitiveness” and that Mr
Cameron must block any attempts to stop Britain using lower taxation rates
to win investment.
“Tax harmonisation would create even more euro-sclerosis,” he said. “Tax
harmonisation between France and Germany is a mutual suicide pact, Britain
should have no part of it.”
Nigel Farage, the leader of Ukip, said: “This move will either force
Cameron to cave in to their demands, or drive Britain out of the EU for
good. Which is it that they want?”.
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