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EU Plans New Powers To Coordinate Taxation

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In a secret document revealed by the Daily Telegraph, France and Germany have plans for more than just the financial tax, which always sounded like a stepping stone to more control over taxation at a later date. They also plan to control taxation policies on energy and corporation tax.

A confidential Franco-German paper, seen by the Daily Telegraph, reveals that the financial transaction tax is seen in Berlin and Paris as the first step to giving the EU a new power to “coordinate” taxation.

The secret text also links existing European Commission proposals on energy taxation and a common method for calculating corporate tax to the push for new EU powers, heralding a major battle over sovereignty this spring.

“European institutions and member states should accelerate the process of tax co-ordination,” the Franco-German paper argues. “In particular the negotiation of the European Commission proposals on energy tax directive, common consolidated corporate tax base and common system of financial transaction tax should be accelerated.”

The EU plan for common energy taxes means we pay more for transport and energy cost.

EU officials have said that the Franco-German push will give a new lease of life to Brussels for new energy taxes that will set higher minimum road and heating fuel duties based on carbon emissions.

British and other European industries are concerned that the legislation will lead to increases in the level of duty on red diesel, damaging competitiveness during a recession.

 

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India And Iran To Drop The Dollar

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Reuters has reported that India and Iran have decided to drop the dollar in some of their oil trade between the two countries.

 India and Iranhave agreed to settle some of their $12 billion annual oil trade in rupees, a government source said on Friday, resorting to the restricted currency after more than a year of payment problems in the face of fresh, tougher U.S. sanctions.

India, the world’s fourth-largest oil consumer, relies on Iran for about 12 percent of its imports or 350,000-400,000 barrels per day (bpd) and is Tehran’s second-biggest oil client after China.

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An Indian delegation has been in Tehran this week discussing options for payment and the source said the decision to pay in rupees was made after a meeting there.

“The Central Bank of Iran will open an account with an Indian bank for receiving payment and settling its import,” the source, who has direct knowledge of the matter, said, adding the new system will start “soon”.

The source did not specify the name of the Indian bank. But other sources have said that Iran could open an account with India’s UCO Bank as it does not have any interests in the United States.

In addition to rupee payments, Indian refiners will continue to make payments through the current mechanism using Halkbank, this source said, “as long as it continues”.

How about this for a kick in the stones for Obama’s administration 😉

India Trade Secretary Rahul Khullar said this week that the Indian delegation to Iran would work around the U.S. sanctions to protect oil supplies and promote Indian exports.

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Asian support for U.S. sanctions is vital since the region buys more than half of Iran’s daily crude exports

This follows a list of large Asian and Middle East countries that have abandoned the dollar in trade between themselves. In a previous post we wrote about Iran and Russia dropping the dollar.

No Solution For Euro Says Fitch Ratings Agency

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Edward Parker of ratings agency Fitch gave a speech in Madrid yesterday and admitted that they believe

a comprehensive solution to the eurozone crisis is “technically and politically beyond reach.”

Fitch said it came to this conclusion after the EU summit on December 9, 10, as it prepares to downgrade Ireland and five other eurozone states.

As a consequence of Fitch’s views on the euro being unresolved, it plans a spate of sovereign downgrades this month which follows on from S&P who last week downgraded a number of countries. This spells further bad news for the eurozone leaders plans to bring calm to the situation.

the agency was likely to cut the ratings of six euro nations by the end of this month. Fitch, the third-largest rating agency, placed Belgium, Cyprus, Ireland, Italy, Slovenia and Spain on “negative” watch in mid-December, after the summit.

Source: Irish Independent

 

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