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Stubb says EU petrol tax to fund migrant crisis worth considering, Soini says no way

German Finance Minister Wolfgang Schäuble has proposed that an extra levy on petrol should be enforced throughout the European Union to fund the refugee crisis and enforce Schengen’s external borders. Finland’s Finance Minister Alexander Stubb says the idea merits consideration, while the Foreign Minister Timo Soini flatly rejects any semblance of an EU-imposed tax.

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Image: Timo Heikura / Yle

Finland’s Minister of Finance Alexander Stubb of the centre-right National Coalition Party says he is open to the proposal of his German counterpart to introduce an EU-wide petrol tax, adding that he considers the idea to be more of a conversation starter and not an actual presentation. He says the idea is worth considering, even if it would be difficult to implement.

“For two reasons, basically: first, because no one wants to raise tax rates right now and second, because tax issues are largely the prerogative of individual nations at present. This would be a new kind of EU tax,” Stubb said.

The German leader has suggested that adoption of the extra levy on petrol would be voluntary among the EU Member States. Would Finland be ready to join Minister Schäuble’s “coalition of the willing”?

“At this stage, I feel the proposition is problematic from Finland’s point of view, but I don’t want to condemn the idea flat out because we must continuously be on the lookout for creative solutions to resolve the crisis. We must leave room for discussion of every suggestion,” Stubb said.

Soini: Internal EU budget transfers, not taxes

Foreign Minister Timo Soini of the EU-sceptic Finns Party dismisses Schäuble’s idea of an EU-dictated tax out of hand, as determination of tax policy is outside of the European Union’s scope. He says Finland should under no circumstances take part in the proposed coalition.

“I would hold it as a very poor and serious precedent. Granting the EU the right to impose taxes would only lead step by step to more taxes. Tax matters should be left for national governments to decide,” Soini said.

Finance Minister Stubb estimates that Schäuble’s proposal is closely linked to both Turkey’s financial needs and Greece’s insecure borders.

“Schäuble probably wanted to bring up the fact that there is an acute need for funding and that something should be done about it, because there has been no progress,” he said.

Minister Soini says the EU’s external borders should be fortified with money from the EU budget. 

“The matter should be addressed with an internal transfer of EU funds, in other words, by cutting subsidies from other areas. Cohesion funds could be the subject of critical examination, for example. Another option is to take on debt, but I don’t recommend that,” Soini said.

No money left

Finance Minister Stubb says the European Union’s budgetary resources are currently exhausted, so the money to address the migrant crisis won’t be coming from that arena.

He says the EU petrol tax was one of several ideas briefly discussed late last week at meetings of the Eurogroup and the Economic and Financial Affairs Council (ECOFIN), composed of economics and finance ministers from the 28 EU Member States. Stubb did not attend the meetings because he had the flu.

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