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Austria Proposes New Taxes to Fund EU

With Austria currently at the helm of the EU, Austrian Chancellor Wolfgang Schüssel has proposed new taxes to fill the EU's coffers, reducing the bloc's reliance on contributions from member states.

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Wolfgang Schüssel: "The old days are gone"

In his role as the current EU president, Austrian Chancellor Wolfgang Schüssel has taken it upon himself to broach the controversial issue of introducing a European tax.


Speaking to the European Parliament in Strasbourg, Schüssel said the bloc should consider taxes on air travel, maritime transport and short-term financial transactions instead of relying solely on contributions from national budgets.

"Europe needs stronger own resources," Schüssel told parliament, adding "if we don't tackle this issue, then reaching agreement on the next financial perspectives will be under threat."

"The idea of a stronger own resources system, 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," Schüssel said.

He said that the current financial system, which was already under stress when the EU was comprised of just 12 members, is untenable in a Europe of 25 or 27 members.

"The old days are gone," Schüssel said.

Attempt to ease budget woes

EU Parlament Wolfgang Schüssel in Straßburg

Schüssel presented his country's EU program for the next six months

The Austrian chancellor's proposal is being seen as an attempt to appease parliamentarians who are unhappy with the EU's austere budget for 2007 - 2013.

On Wednesday, the assembly rejected the budget in its current form, but diplomats said the parliament was likely to accept a compromise with limited extra funds and some extra powers for itself.

"Parliament is rejecting the financial perspectives proposed by the Council but we want to start negotiations on this which will make it possible to reach an agreement," European Parliament President Josep Borrell told a news conference.

Schüssel told members of parliament that there was "a certain room to maneuver" on the budget, adding that the extra figure is "something between 1 and 4 billion euros ($1.2 - 4.8 billion)." An Austrian spokesman later said the chancellor had been talking about shifts within the spending limit, not extra money.

Budget negotiations with the member states are due to begin on Jan. 23. Borrell, Schüssel and EU Commission President Jose Barroso agreed that they should be concluded by April 3.

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