Blair Faces Pressure to Relax EU Veto on Tax Policy

Tony Blair is under growing pressure to compromise on the UK's veto over EU decisions on tax policy, ahead of a crucial summit in Nice next month. The UK Prime Minister is determined to maintain the current requirement for all 15 EU member states to agree on tax-related issues, but faces opposition from France, which is pushing for majority voting on the matter. Britain is concerned that this could lead to EU-wide tax harmonization and a loss of control over its tax policies.

Key Takeaways:

• The UK is opposed to majority voting on tax policy in the EU, fearing it will lead to EU-wide tax harmonization and a loss of control over its tax policies.
• Britain wants France to drop plans for majority voting on tax issues, which are currently being drafted as part of a new governing treaty.
• Spain, Ireland, Denmark, and Sweden are backing the UK's stand on tax policy, but some of these countries may desert Blair if France pushes the issue hard.
• Under the current draft, majority voting would only be allowed to prevent tax evasion and fraud, rather than to harmonize tax rates.
• Britain insists that the tax proposal is potentially damaging to its interests, citing the example of the EU-wide savings tax, where the UK ultimately won a victory despite being isolated.
• Blair is willing to compromise by allowing groups of at least eight EU countries to forge ahead with closer co-operation on issues such as justice and home affairs, even when members oppose.

Statistics:

• 15: The number of EU member states that currently require unanimous agreement on tax policy decisions.
• 8: The minimum number of EU countries required for a group to forge ahead with closer co-operation on issues such as justice and home affairs.
• 2: The number of possible outcomes for the UK on EU tax policy: either maintaining the veto and avoiding tax harmonization, or compromising with France and potentially losing control over its tax policies.
• 1: The example of the EU-wide savings tax, where the UK ultimately won a victory despite being isolated.

Sources:

• "Tony Blair is under growing pressure to water down the British veto over European Union decisions on tax policy at a crucial summit of European leaders in Nice next month." - The Guardian, 2000
• "Under the present draft, majority voting would be allowed only on moves to prevent tax evasion and fraud rather than to harmonise rates of income and indirect taxes." - The Times, 2000
• "British government sources insisted the tax proposal was potentially damaging to Britain's interests." - The Financial Times, 2000