Chancellor Gordon Brown has joined with other European finance ministers in rejecting plans for the introduction of a new EU tax.

Belgium, current holders of the rotating European Union presidency, have suggested that a new Europe-wide tax could be introduced to fund the EU's budget.

Meeting with other finance ministers at a meeting of Europe's Ecofin committee in Brussels on Tuesday, Brown said: "The best possible message we can send out is that we will step up the momentum of structural economic reform in product, capital and labour markets. And that will be our first priority - not tax harmonisation."

Other finance ministers also declined to support the tax plans, with Dutch and Irish ministers expressing their lack of enthusiasm for the concept.

Supporters of the tax proposal argue that it would make citizens across the EU feel more involved in the European project, a key aim for Europe's leaders following the rejection of the Nice Treaty by Irish voters in a recent referendum.

At the end of May, commission president Romano Prodi also came out in favour of a similar tax plan to pay the EU's £60 billion annual cost. He argued that the introduction of a European tax in place of contributions from member states was an issue firmly on the table.

The British government argues that rather than consider new taxes, the commission should focus on spending the cash it already receives more effectively.

The government is also keen to avoid providing ammunition for eurosceptics, who claim that an EU tax is evidence of moves towards a European "superstate".

The tax dispute follows Belgium's assumption of the EU presidency on July 1. The country's work programme for the presidency commits it to moving forward on a number of tax issues.

"The presidency will make efforts to push through a fiscal package. Simultaneous progress in the three areas covered by the package - tax on savings, taxes levied on businesses, interest and charges - is crucial here," says the programme.

However, plans for an EU-wide tax are a long way from being finalised. Instead, during the Belgian presidency attention is more likely to focus on the harmonising of VAT rates across the single market to prevent "distortions".