EU's stimulant package hard to implement

A stimulant package of two thousand billion euro is recommended by the EU Commisssion to be able to get Europe out of the economic crisis. It includes among others the lowering of Vat for certain services and tax reduction for low-income earners.

"We find ourselves in an exceptional crisis period," says EU Commission Chairman Jose Manuel Barroso when he presented the economic package of 200 billion euro to help Europe out of the economic stagnation. But it is not the EU Commission sittting at the driver's seat responsible for the EU member state's economic recovery.

A large part of the package which consists of 1.5 percent of EU's BNP rests on the 27 EU member-countries. They are the ones, through different types of financial measures, that will inject the necessary adrenalin in the economy with 170 billion euro, while EU's common budget stands for 30 billion euro is earmarked for different loans, previously-assigned payment of fund and investments in common EU projects.

The EU Commission presented some kind of a la carte menu of suggestions that the member states can use to get their economies moving. They include both tax reduction and increased fees. Some countries could decrease tax for low-income earners, lower Vat to 15 percent ( in Sweden it is 25%) and added support for the production of environment-friendly cars as well as incentives to the construction and infrastructure sector.

The decisions of the EU-member countries will be taken up on Dec. 11-12 when they meet in Brussels. Several countries already set in motion several financial measures in their respective budgets as well as other urgent measures immediately after the crisis outbreak. Sweden says that it has done its own homework in the new budget. "It is in line with what we do and are prepared for more should the need arises," says Swedish Labour Minister Sven Otto Littorin.# (Translated and edited from DN, 27 Nov. 2008)