Ackerl wants party to veto EU financial rescue bids

The Social Democrats (SPÖ) are in turmoil after a provincial department chief has suggested blocking European decisions to increase chances of the introduction of a new levy.

SPÖ Upper Austria boss Josef Ackerl said yesterday (Weds) the federal party board should veto European Union (EU) actions considering debt-stricken members like Greece. Ackerl argued Austrians would not comprehend why the Austrian government agreed to participate in the financial aid measures for the southern country while agreeing on draconic cuts affecting them at the same time. The left-winger argued Austria may increase the chances of the introduction of a tax on financial transactions across the EU by vetoing certain disputed decisions.

Ackerl also said political leaders in the EU should focus on taxing speculators and those who were responsible for the volatile situation on the financial markets. “The SPÖ and our Social Democratic chancellor must show more presence in favour of a tax on transactions in Europe,” he said in a radio interview.

SPÖ Financial Affairs Councillor Andreas Schieder dismissed Ackerl’s ideas. Schieder argued today that the issue was not something that should be linked to vetoes. He added that the Austrian and European Social Democrats were applying “an extreme amount of pressure” to introduce a tax on financial transactions. Schieder claimed such a levy could come into force within the next five years. Referring to measures meant to bolster Greece, he said it was important whether the country fulfilled its criteria.

SPÖ General Secretary Günther Kräuter described Ackerl’s suggestion as “an opinion coming from a province,” while SPÖ Styria chief Franz Voves explained a veto “is not the right way to make an idea become reality in my opinion.”

SPÖ chairman and Chancellor Werner Faymann refused to comment on Ackerl’s appeal. The chancellor came under fire by representatives of his party’s left-wing branch for failing to get a levy on financial transactions underway as part of the most recent tax reform. Several SPÖ officials and some economic opinion leaders claimed Austria should lead the way and set up such a tax within Austria if EU leaders fail to come to an agreement. The Austrian People’s Party (ÖVP), which forms a government coalition with the SPÖ, has also said it supports the idea of a financial transactions tax. However, the conservative party has shown significantly less effort than some SPÖ members to actually set up such a measure.

The debate regarding a tax on financial transactions is not the only issue Faymann has been criticised for. Left-leaning SPÖ officials hit out at the chancellor when it emerged that this year’s tax reform does not feature a tax on assets. Some commentators claimed Faymann was scared of introducing such a levy since it would mean a blow to the multi-millionaire owners of the leading Kronen Zeitung newspaper, the Dichand family. The Kronen Zeitung has backed Faymann ever since he took over as SPÖ boss in 2008. Some SPÖ officials have said Faymann would be under greater pressure due to his allegedly excessive opportunism were the party able to provide a number of potential successors strong enough to secure its leading position.

Ackerl’s appeal to veto financial rescue measures by the EU in favour of ailing member nations comes around one year after he failed to convince the SPÖ-ÖVP administration that Austria should implement a “tax on riches.” The SPÖ Upper Austria leader said a petition in favour of such a levy was signed by 15,000 people. The left-winger announced everyone owning assets over one million Euros should be affected by the measure. He claimed a new tax burdening wealthy Austrians was “just and bearable.” However, Ackerl’s suggestion fell on deaf ears with the federal SPÖ.

Ackerl became head of the SPÖ’s Upper Austrian department in 2009 after the party suffered a loss of 13 per cent in the provincial election. It garnered only 25 per cent. Erich Haider decided to resign a few days after the ballot after having said after the results were published he was willing to remain in charge.

His call for a tax on assets was accompanied by research revealing that labour and incomes have been taxed excessively in Austria while assets, inheritance and land are barely affected. Several domestic think tanks as well as international organisations like the International Monetary Fund (IMF) came to this conclusion.

Erste Group Bank AG (Erste Bank) chief Andreas Treichl, who is close to the ÖVP, also spoke out in favour of a tax on assets, while Hans Peter Haselsteiner – who heads building company Strabag – said: “Absurdly high incomes must be taxed absurdly high.”