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Austria solely holds tax interest plans at EU summit |
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News |
June 21, 2000
SANTA MARIA DA FEIRA, Portugal (AP) - Austria, which failed to convince its European Union partners to lift sanctions against it, was the sole holdout blocking a compromise Tuesday on a plan to tax interest earned on savings in other countries.
As the 15 EU leaders resumed their two-day summit here, it appeared Austria would be leaving empty-handed, having been told again by its partners their sanctions to punish the government after Chancellor Wolfgang Schuessel formed a government with the far-right Freedom Party would remain in place.
Portuguese Prime Minister Antonio Guterres told Schuessel Monday there was no enthusiasm among the other 14 EU nations to end the sanctions. Portugal now holds the EU presidency.
"There is no reason to change the rules," Belgian Prime Minister Guy Verhofstadt told reporters after the leaders had dinner Monday.
Austria opposed a proposal whereby EU nations would exchange information on citizens earning interest on savings in other countries.
The compromise would allow for a 20 percent withholding tax on interest Europeans earn on savings in other countries until the information exchange can be formalized with key non-EU nations as well.
In all, the complex tax measure foresees a maximum nine-year implementation period.
The matter was discussed Monday by the EU finance ministers and the EU leaders who were to return to the issue Tuesday.
Mindful of the setbacks of bringing stability to Kosovo, the EU leaders agreed to assemble a police force of 5,000 specially trained police to go to hot spots on short notice.
Javier Solana, the EU's foreign and security policy chief, reported to the 15 EU leaders Monday that efforts to create an EU military force of 60,000 troops, separate from NATO for peacekeeping and humanitarian crises, was proceeding well but that more must be done for the civilian side of crisis management.
In Kosovo, the U.N. civilian administration suffered for months for lack of well-trained police officers to maintain order.
“The shortage of high quality police officers, of judges and prosecutors as well as the overall shortfall in staffing continue to undermine the work of (the United Nations) in key areas," Solana said in his report to the summit on the Balkans.
Belgium, France, Portugal and Luxembourg are the harshest critics of Austria's Schuessel, a mainstream conservative who invited the far-right Freedom Party - widely seen as opposing a multicultural society - to form a government last February.
Before Austria's partners drop their sanctions, "we need to see a change from the Austrian government," Verhofstadt said.
He added "it was the formation of the Austrian government that led to the sanctions" - minor measures, such as bans on cultural and sports events or secondary military cooperation accords, but which have served to spoil the atmosphere at EU meetings and summits.
Austria warned its partners are driving it to veto the EU's eastward expansion. Finance Minister Karl-Heinz Grasser said:” Enlargement cannot be debated when inside the European Union there is no constructive cooperation." He added the same was true for the difficult debate about reforming EU institutions ahead of enlargement that is expected to happen by 2005 or 2006.
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