27 May 2008 - 07H51
Sarkozy urges suspension of European VAT on oil
French President Nicolas Sarkozy urged the suspension of the European value-added tax on oil to fight the rising price of petrol. Sarkozy suggested during a radio interview that EU leaders could set a cap on the tax, based on the barrel price.
French President Nicolas Sarkozy on Tuesday proposed suspending the European value-added tax on oil to help countries deal with the soaring price.
"I want to ask the question to our European partners: if oil continues to increase, should we not suspend the VAT taxation on the price of oil," Sarkozy said in a radio interview.
He spoke as French fishermen kept up protests over high fuel costs launched three weeks ago and Spanish fleets went on strike to press demands for government compensation.
French consumers pay about 19.6 percent European VAT on the price of oil, which Sarkozy said had doubled since he took office last year to reach more than 130 dollars per barrel.
Sarkozy suggested that EU leaders could set a cap on the tax, based on the barrel price.
"It is out of the question to promise this, because naturally, I can't decide it on my own," he added.
"But I gather that France is not the only country confronted by the rise in the price of oil."
France is to take the helm of the 27-nation European Union in July.
"I am saying to the French people, oil is going to continue to increase," the president added.
Reply
Expelled for wearing a miniskirt... in Brazil
Stay tuned
