July 3 (Bloomberg) -- The European Union needs a ``level playing field'' in areas including tax competition and market liberalization if there is to be greater integration among member states, German Finance Minister Peer Steinbrueck said.

A ``race to the bottom'' regarding wages, taxes, social and environmental standards risks discrediting the idea of a more united Europe among the continent's citizens, Steinbrueck said in a speech prepared for delivery today in Frankfurt an der Oder, on the eastern German border with Poland.

``Reciprocity and the creation of similar starting positions for companies in European competition is of special importance,'' Steinbrueck said. ``Unfortunately, such fair competition doesn't always exist.''

The comments reflect Steinbrueck's growing impatience with European governments that protect their biggest companies from foreign competition while relying on EU transfers to finance low- tax policies. Germany is the EU's biggest net paymaster.

The average corporate tax rate in Europe shouldn't fall below the threshold of just under 30 percent, which will go into effect in Germany next year, Steinbrueck said. Eastern European governments, which rely most on EU transfers, can't finance the infrastructure demanded by their citizens if taxes are lowered too much, he said.

Still, Germany, during its six-month EU presidency which ended June 30, made ``no tangible progress'' toward the introduction of a common corporate tax base, Steinbrueck said. Other EU members are shielding their postal monopolies while Germany has taken steps to liberalize the market, he said.

The European Court of Justice, which has overruled several German laws, has made itself the ``advocate of the interests of multinational corporations,'' Steinbrueck said in his speech, Deutsche Presse-Agentur reported. The minister questioned the judges' proficiency in tax and state aid matters, DPA said.

To contact the reporters on this story: Rainer Buergin in Berlin at rbuergin1@bloomberg.net; Claudia Rach in Berlin at crach1@bloomberg.net.

Last Updated: July 3, 2007 09:22 EDT