French try to turn EU spotlight on tax

The move, less than three weeks before the meeting, adds weight to Tory claims that the summit will be a major step towards tax harmonisation.

It is understood that the issue was added to the agenda by a small group of left-wing advisers close to French prime minister Lionel Jospin.

The proposals include plans to harmonise employment taxes and provide new regulations to corporate tax regimes.

The British government has previously told the French it will resist any moves to alter legislation on domestic employment, social security and investment taxes at Nice.

Conservative MP John Redwood claims that the summit is a roller coaster towards harmonised taxation.

He believes the French motive is to extend European powers of taxation.

Mr Redwood said: ‘Trying to stop fraud or tax evasion will give the community a platform for doing almost anything it likes.

‘Recreating a harmonised market place throughout the single market will give it another pretext for dramatic tax changes throughout the year.

‘If we sign the treaty of Nice were on a slippery tax on common taxation.’

A spokesman for the Treasury said: ‘We have said time and time again that tax harmonisation is not a consideration for the British government. As the prime minister has made clear, there is no quest of tax harmonisation.’

Senior members of the European Commission are understood to be ‘irritated and disappointed’ at the last minute French move.

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