After meeting German Finance Minister Wolfgang Schäuble yesterday (24 August), François Baroin, the French budget minister, said the two agreed Brussels-based proposals for a budgetary increase were out of step with governments who were implementing austerity measures.
"We can't ask for deficit reduction on the one hand, to adhere to the logic of the stability pact, and on the other hand make demands for increases which are objectively inadmissible. We confirmed this point," Baroin said.
The meeting was reportedly part of plans by French President Nicolas Sarkozy to sew up Franco-German fiscal convergence ahead of EU talks in Brussels.
The visit will be followed by a trip to the UK to discuss the EU's next budget, Baron explained in an interview with French centre-right newspaper Le Figaro.
Earlier this month, UK Prime Minister David Cameron said he wanted to see the EU's budget reduced.
EU tax 'distortion of the truth'
The big three will reportedly also resist any EU taxes to supplement the budget.
The EU executive admits it proposed a 5.9% boost to the Union's upcoming budget but maintains that reports on a direct EU-wide tax are "a distortion of the truth" and "out of context."
In an interview with journalists, EU Budget Commissioner Janusz Lewandowski allegedly advocated taxes on carbon as one of several solutions designed to feed the EU's shrinking budget.
"We are not working on a direct EU tax," Patrizio Fiorilli, Lewandowski's spokesperson, told EurActiv.
Lewandowski is not an "instinctive" advocate of direct taxation, Fiorilli added, claiming that the commissioner "almost single-handedly" privatised post-Communist Poland.
The commissioner wants to see if he can help member states pay less for the EU and he wants to see if budget gaps can be addressed through taxation, Fiorilli continued.
"He is just a scientist in a lab examining four samples." Those four samples are a carbon tax, an air travel tax, a tourism tax and a financial transactions tax (FTT), Fiorilli added.
An FTT has curried the most favour among governments, who agree that banks should somehow repay for taxpayer-funded bailouts.
Its popularity, however, has been trumped by an EU proposal for a bank levy which would see banks' balance sheets, and not transactions, face a flat tax (EurActiv 25/08/10).
An FTT would also more or less satisfy three conditions the commissioner has set out for possible taxes, which are that it is uncomplicated to administer, politically acceptable and does not impose "any further fiscal burden on member states," Fiorilli explained.
The spokesperson cast some doubt on whether a carbon tax would satisfy the aforementioned criteria as the procedure required to collect such a tax was still non-existent and even if it were adopted, most of the revenue would likely go to national coffers anyway.
The Commission will release its budget review, effectively an audit of the administration's income and expenditure, at the end of September, which will include options to reduce member states' contributions, Fiorilli added.
The 27-member bloc's overall budget for 2014-2020 is due to emerge around the middle of next year.
