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ROYALS WILL HAVE TO TIGHTEN BELTS, BRITISH PAPER SAYS

A British newspaper reported Monday that the government was planning to cut the multimillion pound state subsidy to the monarchy in an agreement that would also involve Queen Elizabeth paying voluntary taxes.

The Guardian, quoting political sources, said Prime Minister John Major's Conservative government had gained the consent of the queen for a review of royal finances after increased criticism of the family and its fortune.Major's office and palace officials refused to comment on the report.

The reported plans would cut the monarchy's $16.7 million annual expenses payout by reducing the so-called Civil List of subsidized royal family members to the queen and three others. At present, 11 royal family members each receive part of the subsidy, with the sovereign getting the bulk of the money.

The newspaper reported that the queen would make a voluntary contribution to the state tax coffers from her private fortune, which she currently enjoys free of tax, in the new settlement to come into effect by 1996.

Recent opinion polls have recorded majorities of up to 90 percent of people in recession-weary Britain who want the queen to pay tax and the Civil List to be scaled back.

Rumors of a deal grew after the queen met Major this month for their annual summit at the Scottish palace of Balmoral.

Major is thought to have suggested a review to stem a tide of criticism of some of the younger royals.

"We do not comment on matters relating to the royal family and finances," said an official at Major's office.

The extent of any tax contribution on the queen's private fortune, rated by a business magazine this week at about $170.4 million, minus state assets, is unclear.

A Civil List of the queen; her husband, Philip; her mother, Elizabeth; and her second son, Andrew, would still cost about $15 million a year, assuming their individual payments would not be drastically cut from current levels.

Heir to the throne Prince Charles and his wife, Diana, live off an estimated $3.4 million yearly income from his private Duchy of Corn-wall estate.