Proposals to freeze the next EU budget would "kill off" Commission plans to reform the Common Agricultural Policy, the President of the European Commission, Mr Jacques Santer, warned yesterday.
Briefing journalists in Brussels before the weekend's Vienna summit, Mr Santer also reiterated Commission concerns that the budget "stabilisation" plan being pushed by the Austrian Presidency, and strongly supported by the richer net contributing countries, would result in a real cut of some 18 per cent in the EU's structural funds from 2000 and a full 28 per cent over the budget period 2000 to 2006.
Mr Santer strongly defended the Commission's Agenda 2000 package, which Ireland supports, insisting that it contains strong elements of stabilisation of the budget both in terms of retaining the overall spending ceiling of 1.27 per cent of EU GDP and in curtailing actual spending to the same level as commitments entered into for 1999.
He warned that budget cuts were not just "theoretical" but had real effects on crucial policies such as the CAP and cohesion which must be maintained "as an essential pillar of a community based on solidarity". He also made it clear that the Commission would not be coming forward with proposals to delay the abolition of duty-free sales unless all 15 EU leaders gave their support. Mr Igino Sogaro, president of Euro-commerce, representing EU retailers, has written to EU governments urging them to stick to the decision to end intra-EU duty-free sales.
"Tax exemptions for duty-free shops lead to distortions of competition which fall back on regular commerce that has to pay taxes and, at the same time, leads to considerable tax losses for the budgets of the member-states," Mr Sogaro wrote.
