Industry calls for burdens on business to be eased

Date: 29/06/2000

By Simon Coss

The French government will have its work cut out if it wants its forthcoming presidency to be a success in the eyes of the country's business sector.

The Mouvement des Entreprises de France (MEDEF), which represents the state's biggest private-sector employees organisation and is a prime mover in EU business lobby group UNICE, has come up with an impressive 'hit list' of measures it wants Paris to make progress on over the next six months.

MEDEF's demands fall into two broad categories. Firstly, the organisation says Paris should do everything it can to ensure that fiscal and legislative burdens on Union businesses are reduced to an absolute minimum. Secondly, it is calling for some pretty drastic reforms to the EU's founding treaties which it insists are necessary to ensure that the Union continues to function smoothly after enlargement.

MEDEF is unlikely to have much success in either area. France's Socialist Prime Minister Lionel Jospin heads a coalition government which includes Communists and Greens and has made no secret of his desire to build a 'social Europe' to complement the EU's single market and the euro.

On the fiscal question, MEDEF supports the highly contentious idea of changing the treaty so that all future legislation concerning taxation and the internal market is adopted by qualified majority vote in the Council of Ministers rather than by unanimity, as is the case under the current rules.

More specifically, it is calling for harmonised rates of value added tax and corporation tax. It also wants the Paris to work to eliminate double-taxation, where companies and individuals pay levies in two or more member states.

In a move guaranteed to raise the hackles of environmentalists and the European Commission, the organisation also says plans to introduce a tax on certain energy products should be abandoned once and for all.

In addition, it is calling on Paris to try to end the deadlock over plans to allow firms to set up as EU-wide undertakings, instead of being forced to set up national subsidiaries in each member state. It has proposed creating what it calls a 'European private company' to replace the current controversial plans for a European 'company statute'.

The French government will have its work cut out if it wants its forthcoming Presidency to be a success in the eyes of the country's business sector. Article forms part of a survey on the French EU Presidency, July-December 2000.