German states bid to block ecotax reforms

The German government suffered a defeat at the hands of state representatives in the upper house (Bundesrat) on Friday when opponents of new ecotax legislation won their bid to have it decided upon by the parliamentary conciliation committee. All opposition-ruled states, which have a majority in the Bundesrat, plus SPD-led Lower Saxony, oppose government plans to raise an additional €1.4bn through ecotax reforms (EED 07/11/02). The Bundesrat argues that the "exclusively fiscally" motivated law, due to enter into force on 1 January 2003, will cut industry's investment and consumers' purchasing power. See press release.

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