Parliament opens debate on future EU budget 

MEP Alain Lamassoure (EPP-ED, France) opened the debate on the EU's future income resources with an own-initiative report adopted by the Parliament's Budget Committee on 12 March.

The report, a non-binding text which will be put to a plenary vote later this month, comes ahead of Commission proposals for the revision of the budget due later in the year. A wider budget review, scheduled for 2008-09, will deal with both revenue and expenditure.

In his report, Lamassoure proposes an overhaul of the budget in two stages. In a first transitional stage, until 2013, the EU budget would restore principles of "equality, simplicity and solidarity" between member states with, for instance, the abolition of the UK rebate.

The idea is "to ensure that bargaining and privileges are eliminated", a Parliament spokesperson said.

Compensation for the UK would come in the form of the abolition of the VAT resource and a compulsory co-financing of farm payments made via the common agricultural policy (CAP) which currently largely benefits French farmers.

The second stage, after 2013, would see the introduction of a direct source of income for the EU to replace national contributions.

Under this system, a certain percentage of an existing national tax would be fed directly into the EU budget "thus establishing a direct link between the Union and the European taxpayer".

But the new system "will under no circumstances grant the EU the right to levy taxes", the spokesperson said, with fiscal sovereignty remaining with the member states.

A key principle would be that the new EU income "must not increase overall public expenditure nor the tax burden for citizens".

"While it is clear…that the time for a genuine European tax has not yet come, in the long term, the possibility of returning to a system as originally intended by the Treaty of Rome should be considered," Lamassoure wrote in the report.