UK Prime Minister David Cameron has ruled out “significant” tax cuts while the Government is tackling the budget deficit.
European countries must implement the structural reforms that Germany has already carried out over the last twenty years to ramp up competitiveness, the economics and monetary affairs commissioner, Olli Rehn said on Friday according to Irish Times.
He also said Germany’s economy entered the crisis on a stronger footing than others within the European Union (EU) because it had adjusted to the new world order by carrying out broad structural reforms.
“Several member states, for example Greece, Ireland, Portugal and Spain, have already entered on an ambitious course of reform and are making progress,” he added.
“There is indeed no doubt that the EU’s entire economy benefits from the strength and resilience of the Germany economy,” Rehn said. “Therefore the continuation of structural reforms in Germany that promote growth is important for the whole of Europe.”
CAMERON: ‘TAX CUTS IMPOSSIBLE RIGHT NOW’
He said he would like to offer “relief”, but this would only be possible “at the end of this hard road”. His comments came in an interview with The Sunday Telegraph ahead of the March 23 Budget.
Chancellor George Osborne is facing calls to reduce the burden on hard-pressed voters as inflation spirals. Tory Mayor of London Boris Johnson has urged him to set out “a clear direction of travel” on how taxes could be reduced. But r Cameron said cutting taxes now would only undermine the Government’s deficit strategy. It has also been reported Mr Osborne is considering a new tax levy on wealthy “non-doms” which could be announced as early as the Budget. The move would help fund the coalition’s commitment to raise the income tax threshold to £10,000. Former prime minister Gordon Brown introduced a £30,000 annual charge on non-doms who have lived in Britain for seven years or more. But according to The Sunday Times, Treasury documents show four out of five of the UK’s 120,000 non-doms do not pay the levy as they leave before then.