The EU’s heads of state and government are set to call for the tax burden on labour to be redirected towards other targets, according to the draft conclusions of the upcoming 30 January European Council.

The draft text, quoted by AFP,calls for member states to take measures to boost job creation, especially for young people. In particular, the draft text says that member states should explore all available methods of transferring taxes on labour towards other forms of taxation. The draft declaration of the summit was inspired by a set of common proposals prepared by Germany and France: this text calls for special efforts to be made to reduce the tax burden on labour in order to create jobs.

This is also the aim of the ‘social tax’ project that French President Nicolas Sarkozy is due to unveil on 29 January, just before the European summit, which is officially dedicated to examining methods of boosting jobs and growth. Sarkozy’s plans to establish a form of VAT that will help finance social security will provoke fierce debate in France, where the idea is particularly contested by the left-wing opposition. The project will be indirectly supported by the EU.