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29. 07. 10. - 14:45

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29. 07. 10. - 14:45

Erste Bank CEO wants tax on assets

The head of Austria’s second-biggest bank has caused a stir by calling for the introduction of a tax on assets.

Erste Bank boss Andreas Treichl told weekly magazine News today (Thurs): "A ’decent’ taxation on assets must be set up, of course, as well as (higher) real estate tax levels and inheritance tax."

Treichl also said tax levels on work must be lowered. This appeal comes just weeks after Claire Waysand of the International Monetary Fund (IMF) appealed to the Austrian government to reduce taxation levels on work.

Treichl’s extraordinary appeal comes as the government coalition of Social Democrats (SPÖ) and the People’s Party (ÖVP) is at loggerheads over how to reduce the budget deficit of 3.5 per cent.

Austria is forced to cut back its state debt of around 200 billion Euros – which equals around 70.2 per cent of the country's gross domestic product (GDP) – by 2013 to avoid sanctions from the European Union (EU) since the Eurozone’s Maastricht criteria enforce the 16 countries with the Euro as their currency of keeping it below 60 per cent.

An increasing number of SPÖ officials has spoken out of a "tax on the rich", while the ÖVP has refused to reveal where it thinks the axe should fall.

Now Hans Peter Haselsteiner, head of Austria’s biggest construction company Strabag, urged political decision-makers to raise tax levels on assets and high earnings.

"Absurd high incomes must be taxed absurdly high," the former Liberal Forum (LIF) financial affairs spokesman told News.

Haselsteiner – who supports various charity activities focusing on poor children in Eastern Europe (EE) – added: "The social peace in Austria must mean a lot to us. It would be put at risk if the gap between poor and rich widens."

Meanwhile, opposition chiefs accuse the SPÖ-ÖVP coalition of deliberately breaching the constitution by planning to ignore the 10-week barrier to present the 2011 budget.

The federal constitution says governments must present their annual budgets at least 10 weeks before the affected year’s New Year’s Day. But SPÖ Chancellor Werner Faymann and ÖVP Finance Minister Josef Pröll revealed plans to wait until December. The coalition leaders claim this step would help them reacting more flexibly to think tanks’ predictions.

Freedom Party (FPÖ), Greens and the Alliance for the Future of Austria (BZÖ) however claimed the government parties feared suffering losses in the provincial elections in Styria (26 September) and Vienna (10 October) if new tax facts leak early.

BZÖ chief Josef Bucher is adamant to call in the parliament throughout its summer break next month, but is depending on the support of all Green and FPÖ MPs to go ahead with confronting the finance minister with questions about possible higher taxes.

Greens financial issues spokesman Werner Kogler said his party has been holding talks with the BZÖ over calling in special parliamentary meetings, but warned that the Greens were not available for "populist pre-election action."

Bucher meanwhile claimed FPÖ leader Heinz-Christian Strache has so far failed to team up for special summits in parliament over fears he would have to cancel his holidays on a Spanish island.

Austrian Times

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