New EU plot to tax our food

THE threat of a double tax raid on millions of Britons by the European Union caused uproar last night.

Business leaders condemned moves by Brussels to seize control of VAT on thousands of everyday items Business leaders condemned moves by Brussels to seize control of VAT on thousands of everyday items

Business leaders condemned moves by Brussels to seize control of VAT on thousands of everyday items.

It could send prices soaring – and even allow the EU to decide whether to slap VAT on essential foods and children’s clothes.

In a second money-grabbing proposal, the European Commission yesterday announced plans to overhaul “green” fuel tax, which could mean a new eight per cent duty on diesel.

The Daily Express is campaigning to free Britain from EU rule, and 373,000 readers backed a petition delivered to Downing Street on the issue. There was outrage last night at the latest EU bid to squeeze more cash from British taxpayers.

Tory MP Douglas Carswell said: “Let’s hope that Chancellor George Osborne is a bit more vigorous in stopping this initiative than he was when allowing the UK to join the euro bail-outs.

This Government must stop the EU taking control of taxation

Conservative MP Douglas Carswell

“This Government must stop the EU taking control of taxation.”

The Institute of Directors, one of Britain’s leading business organisations, warned that proposals to harmonise VAT rules across Europe’s 25 member states could mean the end of Britain’s VAT exemption on food, children’s clothes, books and newspapers.

It may also mean tax decisions being taken by majority voting in EU meetings, stripping Britain of a veto over any meddling in domestic taxation.

Richard Baron, head of taxation at the IoD, said: “It is sensible for the Commission to take a long, hard look at the way VAT operates. It is a massive burden on businesses, and prone to fraud, so improvements are always welcome.

“But we must beware of any assault on national tax powers.”

In a separate move, the EU Commission unveiled plans for an overhaul of energy tax. Options included introducing new taxes on carbon dioxide and fuel use to help the EU meet climate change targets by 2020. One measure would force EU states to set a tax of £18 per ton of carbon emissions for transport and heating fuel from 2013. It would be automatically linked to inflation.

Under proposals to deter the use of high-carbon vehicles, a litre of diesel would be taxed at eight per cent more than a litre of petrol.

UK Independence Party leader Nigel Farage said: “This is just more EU madness. Fuel prices are already at record highs, and the EU now wants to slap another tax on top.

“What they should do is immediately cut the EU budget and stop wasting our money. The British people will continue to be subject to stupidity like this until we vote to withdraw from the EU.”

Jacqueline Foster, Conservative transport spokesman in the European Parliament, said: “We all want to reduce CO2 emissions from vehicles but it should be done by placing incentives on people, not by clobbering them. This could increase the cost of flights and ferries.”

Algirdas Semeta, EU tax commissioner, said: “Our objective is less about introducing a new tax than about restructuring energy taxation so as to meet the EU’s high priority goals of climate change, energy efficiency and fair competition.”

Senior Whitehall officials last night indicated that the Government will seek to block both tax plans, which are to be debated by the European Parliament. One diplomat said: “Without saying that we will definitely kill this thing before it is born, I think it is highly likely that we will block it.”

Would you like to receive news notifications from Daily Express?