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EU, Germany warn against unilateral oil tax steps

REUTERS, Brussels
The European Commission and Germany united Monday to insist EU states should not take unilateral tax measures to offset the impact of high oil prices.
European Monetary Affairs Commissioner loaquin Almunia said there was concern about oil prices, which hit record highs last week, while German Economy Minister Wolfgang Clement in Potsdam admitted lofty oil prices posed "a problem and a certain risk".
But Almunia and Clement's deputy, AlfredTacke, stressed unilateral tax measures were not the way forward.
"Individual actions can't counter it." Tacke said on the margins of a US-German business conference in Neuhardenberg, near Berlin, when asked if taxes or strategic oil reserves could be used tn limit the impact of high oil prices.
"Global supply and demand are the decisive factors, not individual measures," he added.
The Commission was equally
adamant: "No country should take unilateral action," Almunia told reporters in Brussels, stressing the need for prior consultation with other EU states.
With US light crude prices scaling record peaks of 5*19.40 per barrel on Friday, the issue of tax cuts to offset the impact on consumers has re-surfaced in Europe, and espe-ciallvin Italy.
But Italian Economy Minister Domenico Siniscalco was singing from the same hymn sheet during a visit to Bnisselson Monday.
"There is a commitment of European finance ministers to coordinate any measures in this field, especially tax measures," Siniscalco said after a meeting with Almunia.
EU finance ministers in lune pledged to consults each other before acting, anxious to avoid a rerun of unilateral action in 2000, when a French cut in diesel fuel taxes sparked blockades and disruptions in neighbourfagcountries.
Italian Industry Minister Antonio Marzano has proposed tying excise duties to the price of oil so they would be cut when crude prices
were high and raised when prices were low.
But Marzano has said he would write to the EU Executive Commission and ask for an informal meeting of energy ministers while Gianluigi Magri, undersecretary of the Italian Treasury, wants EU finance ministers to discuss the issue next month.
A spokesman for the Dutch finance ministry, which organises die informal meeting of EU finance ministers next month in the Hague, said oil prices were not officially on the agenda. But he added:" I am sure it will be discussed at the meeting.”
The Netherlands currendy holds the rotating EU presidency.
On Friday Almunia said he would not be surprised if EU finance ministers discussed the topic on September 10-II.
Petrol prices vary widely across the EU. both due to the tax levied and local competitive conditions. For example, petrol at Dutch pumps, the most expensive in the EU, is over 50 percent more expensive dian at Greek ones, according to Commission data.