Local view for "http://purl.org/linkedpolitics/eu/plenary/2000-12-13-Speech-3-192"
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"en.20001213.7.3-192"2
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Mr President, I would like to start by commenting on the levy of VAT on electronic services. This topic has been given much attention ever since the Commission introduced the proposal on 7 June of this year. I am aware that some Members have been swamped with opposing views. Since the introduction, Parliament and the Council have shifted a lot of work. Although I am convinced that the Commission proposal, which is still before us, forms a sound point of departure, I have also noticed that Parliament and the Council are helping along the thought process in a constructive manner. This forms a sound basis for further discussion.
Finally, I would like to comment on the report on tax on aircraft fuel. The Commission’s communication regarding tax on aircraft fuel accommodated the request which the Council made in its resolution of 9 June 1997. In it, the Council asked the Commission to provide more detailed information on all aspects of the introduction of such tax and especially on the environmental effects, the competitive position and profitability of the aviation industry within the European Union compared to its competitors outside of the Union, and the possibility of applying other instruments which have similar effects.
This communication took into account the conclusions of an exhaustive study. The upshot of this study was that the environmental effects and the implications for tax revenue and other effects mainly depend on two factors, namely the level and scope of the tax.
I am delighted that Mr García-Margallo’s report by and large supports the conclusions reached by the Commission. The suggestion to extend the scope of excise on mineral oils to include aircraft fuel and thus to end the existing inequality in treatment with regard to different modes of transport has met with strong support. Furthermore, this approach was generally well-received during the discussions which were held within the Council.
The recommendation that future discussions must take place within the framework of the International Civil Aviation Organisation, the ICAO, namely during its 33rd general meeting in September and October of the year 2001, also met with the same level of support. These discussions will prove very difficult, however, since the possibility of levying tax on aircraft fuel was not decided on at the previous general meeting. Accordingly, no major groundwork has been done within the ICAO working parties and it is unlikely that the Chicago Convention will be re-negotiated at the forthcoming general meeting.
Despite this, the Community could urgently request the review of the existing ICAO provisions concerning tax on aircraft fuel to be included in the working programme of that organisation and to underline the anticipated positive environmental effects of such a measure
other ICAO members.
A resolution issued by the general meeting of the ICAO which paves the way for an internal solution to the issue of tax on aircraft fuel or the use of other instruments with equivalent effects would be a crucial first step in the right direction.
Finally, I have noticed that the European Parliament would like to go further than the Commission where the Commission’s opinion is concerned. According to that view, at this moment in time it would be neither viable nor desirable to introduce a tax on aircraft fuel only on flights within the Community carried out by Community aviation companies, for reasons which have been given an ample airing in this House this afternoon.
The European Parliament is of the opinion that in a fast growing sector, such as the aviation sector, the environmental effects of relatively unimportant measures can never be considered insignificant. I would, however, like to point out that current Community tax legislation does not allow for only national and intra-Community flights to be taxed. This would become possible after the Council has approved the Commission’s proposal on the restructuring of tax on energy products, which has been before the Council for discussion since March 1997, and concerning which this House is aware that approval is still pending.
I would especially like to thank the rapporteur, Mr García-Margallo y Marfil, for his contribution and for the positive ideas which were put forward in his report. The Council’s Working Party on Financial Questions also pored over the topic of VAT and e-commerce. The outcome of that consultation was discussed within Ecofin at the end of November. I think that the conclusions of those ministers constitute a step in the right direction. The Council has reached agreement on the following key areas: electronic services must be taxed in the Community if use is made of these within the Community. They are not taxed in the Community if they are used outside of its borders. The guiding principle that suppliers from outside the Community who supply to customers within the Community need only register at one location must not lead to a shift in tax revenue between the Member States. Measures should be taken to avoid this. There is general consensus that a solution must be found whereby suppliers from outside the Community need only register at one location, and this is an absolute necessity in the eyes of the Commission. I would like to briefly comment on the further detailing of this solution.
The rapporteur’s idea to develop a mechanism to avoid distortions emanating from differences in rates meets with the support of a majority of the Member States. I am of the opinion that this idea can be combined with the original Commission proposal for one single registration without putting up bureaucratic barriers for industry. I would like to stress that we are talking about a system of reallocation of revenue and not about the distribution of this revenue. The system of reallocation of revenue will need to be carefully worked out. It is useful to have an objective and clear criterion at our disposal, namely the Member State where the consumer lives. This rules out the complexities which would emerge if macroeconomic or similar criteria were to be applied. Although I do not foresee any insurmountable technical hitches, a great deal of time will need to be invested in the next couple of months in the further development of the system, particularly with respect to the legal basis, so as to enable tax to be levied on all Member States by means of one declaration. As usual, we need to ensure that the solution we opt for does not give cause for concern outside the Community with regard to discrimination against suppliers who are not based in the Community. In this context, I believe that the Council should revisit the issue of threshold amounts for registration and look at whether a fair solution can be found. All in all, a number of details still need to be looked at. I am of the opinion that considerable headway has been made under the French Presidency, and I am convinced that in 2001, Sweden will continue in the same vein.
Given that the debate in the Council is still under way and also given the Commission’s wish to bring the topic of VAT and e-commerce to a successful conclusion in the short term, I am of the opinion that at this moment in time, it would be desirable not to accept Parliament’s amendment proposals formally but to try to incorporate these proposals as far as possible in the negotiations with the Council. However, I do not share Parliament’s ideas on one aspect, namely the introduction of a reduced rate or even a zero rate for electronic services, an idea which was, in fact, floated by various Members this afternoon too.
VAT is a general consumer tax. There are few exemptions from VAT and where these have been introduced, this was generally for cultural or social reasons. Electronic services cannot be brought under this heading and it is unacceptable to stimulate part of industry. The intention of my proposal is to iron out any existing inequalities and to create equal conditions for European and non-European companies. I would like to emphasise that, apart from the difference in insight to which I referred a moment ago, there is far-reaching agreement between Parliament’s and the Council’s approaches and in particular, about registration, threshold amounts and reallocation of revenue, and that in further talks in the Council, the points which Parliament has brought forward will be taken into consideration.
I am also prepared, in principle, to accept Parliament’s amendment proposal on administrative cooperation. This is a simplification measure which regulates the exchange of information between the Member States on VAT numbers in the electronic trade, and we will take the proposal to heart in our future work in Parliament and the Council.
Allow me now to turn to the proposal on the minimum level of the normal rate. Despite the efforts made by this Parliament and the Commission, as referred to by the rapporteur in his report, little progress has been made so far on the activities to replace the present VAT transitional regulation by a final regulation based on tax in the country of origin.
However, it should also be pointed out that the current climate, where the conditions are not favourable for achieving further harmonisation of VAT rates in the short term, makes meaningful progress in the near future very unlikely. Consequently, without prejudicing the idea of a definitive system but with a view to improving the working of the internal market in the short term, the Commission has drawn up a new VAT strategy which comprises four key goals, namely the simplification and modernisation of the existing rules, more uniform application of the present provisions and stricter implementation of administrative cooperation.
It is in the light of this that this proposal is seeking to maintain the existing level of harmonisation in the field of VAT rates by confirming the minimum level of 15% for the normal rate. The proposed five-year period reflects the stability which the new VAT strategy stands for, and reducing this period to three years, as proposed by the rapporteur, seems too short to enable the Commission to meet its obligations. This is why I cannot accept the proposed amendments. Should the circumstances take a dramatic and unpredictable turn within the next couple of years, the Commission can always consider submitting a fresh proposal."@en1
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