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Monti to propose EU tax coordination, not common tax

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Published 26 February 2010

The elder statesman charged with drawing up ideas to boost the European Union's single market said on Thursday (25 February) he would recommend closer tax coordination, but not a fully harmonised tax system.

Mario Monti was asked by European Commission President José Manuel Barroso last year to come up with recommendations in 2010 to revive the EU's single market and fend off economic nationalism.

"I am not, I stress not [...] going to propose tax harmonisation as was reported on a few occasions by the press," Monti told a news conference after discussions with Finnish Prime Minister Matti Vanhanen.

"But I will indeed propose that member states engage, much more than they did in the past, in discussions on cooperative approaches to tax policy, call it tax coordination or tax cooperation," said Monti, a former EU internal market and competition commissioner and now president of Italy's Bocconi University.

While the 27-member EU has harmonised huge areas of legislation in areas such as trade, agriculture and environmental policy, tax remains largely a national domain, with the power to raise and spend taxes jealously guarded by national governments.

(EurActiv with Reuters.)

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