French PM to support a cut in duty for motorists

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The Independent Online

The French Prime Minister, Lionel Jospin, is expected to propose a cut in fuel taxes for ordinary motorists next week, increasing pressure on Tony Blair to do the same in Britain.

The French Prime Minister, Lionel Jospin, is expected to propose a cut in fuel taxes for ordinary motorists next week, increasing pressure on Tony Blair to do the same in Britain.

Mr Jospin is looking for a way to reduce the pump price of petrol and diesel by "paying back" increased VAT receipts from higher fuel prices and taxing the windfall profits of oil companies.

The French premier has been persuaded to act by opinion polls showing a 20 per cent fall in his approval rating since the start of the oil crisis and a widespread anger among French car users that they were denied the concessions given to truck firms, taxis, farmers and fishermen.

Fuel protests continued to wreak havoc across Europe yesterday as Spain, Germany, Ireland and the Netherlands all suffered at the hands of militant truck drivers and farmers.

While Belgian demonstrators removed their barricades German and Dutch protesters continued their campaign and the Netherlands experienced its biggest demonstration yet.

In Spain convoys of truckers and farmers mounted the country's first protests against high fuel costs in an action that mobilised more participants than expected. Barcelona was para-lysed when about 200 hauliers crawled along the main roads entering the city. The position was similar near Schipol airport, Amsterdam.

In Ireland,thousands of lorry drivers clogged roads with ago-slow protest.

The decision of the British and German governments to hold out against the demands of the protesters, and the refusal of Belgium to offer any direct cut in fuel duty, appeared to dampen some protests.

In Germany the picture was mixed. Hauliers massed at the northern town of Bremen,jamming traffic for several hours but farmers in Leipzig attracted fewer demonstrators than expected.

Any move by Paris to cut pump prices across the board can be expected to generate demands for equal treatment across the European Union.

Mr Jospin's room for manoeuvre is limited by two factors. EU rules forbid any country from reducing taxes on petrol and diesel oil below the lowest present level in the Union. The French Prime Minister's Green coalition partners have warned that they would leave the government if there was a permanent reversal of the high-tax policy on road transport.

French government officials say that two clear decisions have already been made. The government cannot be seen to be cashing in on the oil crisis and the oil companies cannot be allowed to make huge, windfall profits on the backs of consumers.

Mr Jospin is expected to announce, maybe next week, that the proposals to reduce the taxes on road fuels immediately have been changed.

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