Barroso refuses to rule out Brussels tax

(STRASBOURG) - The European Union's top executive on Tuesday refused to rule out a bloc-wide tax on its half-billion population, in remarks sure to raise eurosceptic hackles.

Jose Manuel Barroso, the president of the European Commission, said he would look at raising direct EU taxation -- a debate that has sparked anger especially in fiercely sovereign Britain.

Speaking during a regular question-time session in the European Parliament, Barroso was asked if he agreed with the bloc's incoming president, current Belgian premier Herman Van Rompuy, who is on record for proposing direct taxation.

"I intend to look at all issues of taxation in the EU, we have to look at this, we have to look at all resources of the EU," Barroso said, pointing out that tax proposals were the domain of his commission.

"We have promised it to the parliament, the programme with which I was elected was to look at possible 'own resources' and this is in the programme that was adopted by this European Parliament."

In Barroso's successful pitch in September, setting out priorities for his second five-year term, the former Portuguese prime minister said Brussels "cannot shirk the issue of 'own resources'."

Criticising a system of EU financing that has "evolved piecemeal into a confusing and opaque mix of contributions and rebates," he said in that document that Brussels could not rely forever on member state funding alone.

"We need to see how the EU can find a more efficient and transparent way of financing its policies, and to simplify delivery in order to maximise the impact of spending while safeguarding the principles of sound financial management," he underlined then.

Negotiations on the next EU seven-year budget, set to come into force in 2014, are due to start in 2011 but they have already been the subject of commission proposals urging a radical shift in priorities away from the traditional main rump of spending on agriculture.

The EU is also launching a massive so-called external action service, beefing up its diplomatic and foreign services with thousands more staff scattered across the globe.

Before his nomination by EU heads of government and state, Van Rompuy raised the possibility of a European 'green tax' which could eventually reduce state levels of funding for the European pot.

Hostile eurosceptic elements within the English media led a counter-attack on a new European figurehead they characterised as a Machiavellian manipulator with one overarching aim -- to centralise the tax take for Brussels.