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Tax & Spend

EU Seeks More Flexible Penalties to Enforce Debt-Reduction Rules

  • Commission mulls more realistic fine levels for non-compliance
  • New rules will give up to seven years to cut the public debt
European Union Economy Commissioner Paolo Gentiloni

European Union Economy Commissioner Paolo Gentiloni

Photographer: Valeria Mongelli/Bloomberg

The European Union is considering a more flexible set of penalties for member states breaching debt-reduction commitments in an attempt to make fiscal rules more enforceable after years of spotty implementation.

The European Commission also wants to lower the monetary value of existing fines as the current system proved to be politically impossible to apply in the past, said EU officials speaking on condition of anonymity.