Abolition of veto on taxes sought by Prodi

The European Commission has outlined substantial changes it wants to Europe's draft constitution, including the abolition of …

The European Commission has outlined substantial changes it wants to Europe's draft constitution, including the abolition of the national veto on some tax matters and the retention of the right of every member-state to nominate a commissioner with full voting rights, writes Denis Staunton, in Brussels.

The Commission President, Mr Romano Prodi, said that all 20 commissioners wanted an inter-governmental conference next month to back the changes. "The Union's Constitution is a hugely important document. It will govern the way our Union functions for years to come. So it is crucial we get it right now," he said.

The Commission's proposals came three days after Sweden's rejection of the euro, which has raised fresh doubts in Brussels about the chances of the new constitution being approved in referendums around Europe. Mr Prodi said yesterday, however, that the draft constitution was not sufficiently ambitious and left too many policy areas that require unanimity among member-states.

"On certain well-targeted, detailed issues, progress simply has to be achieved unless we want people and businesses to suffer because of our inability to take decisions. Let me be very clear on this. If unanimity remains the rule in combating fraud and tax evasion, the Commission has nothing to lose - but companies and taxpayers might have a great deal," he said.

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The Government has made clear that it will not sign up to any new constitution that abolishes the national veto on all tax issues. The Commission's proposal identifies a number of areas where majority voting should apply, including "taxation in connection with the operation of the internal market . . . combating fraud or tax evasion, measures relating to tax bases for companies, but not including tax rates . . . taxation in respect of the environment; certain aspects of social security . . . and the European public prosecutor's role in safeguarding the Union's financial interests".

Mr Prodi rejects a proposal in the draft constitution to allow each member-state to nominate a commissioner but to give only 15 commissioners the right to vote. In a reversal of his attitude during the Nice Treaty negotiations, Mr Prodi declared yesterday that a Commission of up to 30 members could function efficiently.

"There is no reason to assume a Commission of 25 or more members would necessarily be inefficient. Many national governments have more ministers than that. It all depends on how they are organised," he said.