Brown On Course To Carry Out Domestic Fuel Promise
The European Commission has said that it will not challenge Britain's pledge to reduce VAT on domestic fuel to 5% from 8%.
In Brussels for "constructive talks", Chancellor Gordon Brown said he informed his European colleagues that the proposal to cut VAT on fuel was "legally water-tight" and would be included in his first budget. The Chancellor said this was important because "I want to get reductions in pensioners' fuel bills by winter."
|
|
The Chancellor putting Britain's point of view
|
"I can assure people it will be in my first budget...it is the honouring of our first election manifesto pledge," he said.
Although criticising Mr Brown's proposal to cut VAT on fuel as not in the spirit of EU plans to harmonise national VAT rates up to 15%, the European Tax Commissioner, Mario Monti, admitted that he did not anticipate any "legal obstacle".
"While this measure may not be in the spirit of Community legislation, Gordon Brown feels the letter of the legislation gives the UK freedom to act in this way. Although the Commission's legal analysis can only be completed once the full details are known, I do not see any particular legal obstacle at this stage," he said.
Mr Brown was given a warm reception when he arrived, and stressed the Government's intention of starting a new relationship with our European partners.
Agriculture Minister Jack Cunningham has also been in sensitive talks with Commissioners today, over the lifting of the ban on British beef.
The visits follow last week's initial round of EU goodwill statements from Foreign Secretary Robin Cook and minister for Europe Doug Henderson.
The major question in Brussels is how much Labour is prepared to compromise to get a deal on EU reforms signed at next months European summit in Amsterdam.
Mr Brown, in Brussels for his first meeting with fellow EU finance ministers, is taking the opportunity to visit Economics Commissioner Yves-Thibault de Silguy, who is masterminding the single currency programme. Mr Brown has already said it is unlikely that Britain will join the single currency in time for its planned launch in 1999.
The Chancellor will also hold talks with Commission President Jacques Santer.
|
