Germany and France are split over proposals for a cap on fuel taxes and the lowering of VAT on restaurant meals. The differences became apparent as finance ministers of the 27 European Union countries met in Brussels.
Germany’s Peer Steinbrueck said Berlin is “against short-term tax measures which would prevent the economy from adjusting to higher oil prices.” Steinbrueck also criticised Paris’ plans to cut restaurant sales tax in France.
The ministers did agree on an exchange rate for Slovakia adopting the euro at the start of next year. France’s Christine Lagarde, chairing the Ecofin meeting, said: “I believe that one of the most important events sanctioned during this meeting has been Slovakia’s entry to the euro zone. It’s the first time that a country which was on the other side of the Iron Curtain has joined the euro and congratulations are due all round.”
The rate is the same as that set when Slovakia’s currency was revalued in May. That means EU officials rejected Slovakian Prime Minister Robert Fico’s request for a higher rate which would have helped cool surging inflation in his country.
Slovakia will become the 16th EU nation using the euro.