LISBON (Reuters) – More imagination is needed to tackle the economic repercussions of the new coronavirus epidemic, Eurogroup chief Mario Centeno said on Thursday, suggesting Europe should ponder introducing bloc-wide taxation.
“It’s clear that we can be more imaginative,” Centeno said at a parliamentary hearing in Lisbon. “There has been a huge debate in Europe and in other international forums, such as in the OECD, about taxes that may be of a European nature.”
Centeno did not specify which kind of taxation he was referring to.
Finance ministers of eurozone countries agreed last week on an immediate rescue package worth half a trillion euros but member states are divided on how to finance subsequent economic recovery.
Fiscally conservative northern countries including Germany, the Netherlands, Finland and Austria oppose calls by France, Italy, Belgium and others for joint debt issuance.
Though Centeno said the so-called “eurobonds” remain an option, he also said there are other ideas on the table, including France’s Recovery Fund proposal that would be financed through joint debt issuance.
“At this moment old economics books teach little about how to react to the crisis,” Centeno said. “Being stuck with past doctrines and visions of other contexts of past sovereign debt crises (…) is not part of the answer at this point.”
Finance ministers will meet soon after the European Council’s special meeting on April 23 and the “debt issue” will be on the table, Centeno said earlier this week.
(Reporting by Sérgio Gonçalves and Catarina Demony; Editing by Grant McCool)