Local view for "http://purl.org/linkedpolitics/eu/plenary/2002-06-12-Speech-3-267"
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"en.20020612.6.3-267"2
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".
Mr President, ladies and gentlemen, we are now examining a Commission proposal for a Council decision on the indirect tax in force in the Canary Islands. The purpose of introducing a tax known as 'the AIEM tax on the import and delivery of goods in the Canary Islands’ is to allow Spain to apply lower rates of tax to certain products manufactured in this outermost region. It must be stated, of course, that the purpose of the Community authorisation is not to create the AIEM, because the Spanish authorities are free to do this, as long as Community directives on VAT and on special consumer taxes do not apply in the Canaries. The Council decision is, consequently, necessary, but to validate tax exemptions and their extension to Canarian regional products, an aspect that is not properly clarified in the Commission proposal. The aim of most of the amendments that I tabled, and which were approved by the Committee on Regional Policy, Transport and Tourism, was to ensure that this clarification was made.
The central tenet of the Commission proposal is, therefore, the establishment of tax exemptions under Articles 23, 25 and 90 of the Treaty, on the grounds that discrimination is practised in favour of certain industrial goods manufactured in the Canaries over imported industrial goods, since the former can be taxed at rates 5, 15 or 25 percentage points lower, depending on the type of product concerned. Article 299(2) of the Treaty provides the justification and the legal base for these tax exemptions. This article acknowledges the unique situation of what are known as ‘outermost’ regions and the corresponding need for the European Union to take special steps to help those regions.
The proposal now under consideration deserves my total support. It seeks to enable regions such as the Canaries, which suffer serious competitive disadvantages in the industrial sector as a consequence of their remoteness, better to integrate and exploit the highly competitive dynamic of the single European market, of Economic and Monetary Union and of globalisation itself. This type of specific measure is crucial to ensuring the survival and modernisation of industrial activity in the Canaries, which now produces little more than 5% of regional GDP, when historically it has always generated very high levels.
The integration of the Canaries, however, into the customs territory of the European Union in 1991, and the gradual dismantling, by 1999, of the tax then in force, which was also intended to protect regional production, have accentuated the fragility and the vulnerability of the Canaries’ industrial sector to external competition. As the situation in the tobacco industry shows quite clearly, the decline has been steady. Between 1985 and 2000, the tobacco industry shed more than 3 300 jobs, or around 67% of its workforce. It is, therefore, imperative that we ask ourselves the following question: should the full integration of the Canaries mean that their industries are all but wiped out? Should the Canaries depend almost exclusively on tourism-related activities for job and wealth creation? Is this not too heavy a price for the Canaries to pay for their full integration into the European Union?
The Commission proposal that we are now looking at is, therefore, a legitimate and appropriate instrument for guaranteeing a minimum degree of economic diversification in a region with the specific characteristics of the Canaries.
This proposal is also justified, however, in light of other considerations, not least the competitive inequality suffered by industrial firms in the outermost regions. It is well known that remoteness imposes additional costs on industrial activity in these regions and that, in the specific case of the Canaries, these costs are estimated to stand at around 8 percentage points for large undertakings, 9% for the SMEs, and even reaching 29% for tobacco production. This situation forces us to draw a conclusion of paramount importance, which is the following: instead of being harmful to free competition, the tax measures proposed by the Commission are designed to level out conditions for competition. This is the only way we will be able to guarantee genuine equality of opportunity for Canarian industrial operators or, rather, for some of them, provided that the tax measures proposed are not universal and systematic.
I therefore believe that we are discussing the appropriate instrument with which to respond to the specific needs of the Canaries as an outermost region and the Committee on Regional Policy, Transport and Tourism expressed the same view when it approved my report by overwhelming majority. If the European Parliament is to be consistent with its previous positions demonstrating clear solidarity and support for the outermost regions, it must deliver a favourable opinion on the Commission proposal we are now discussing."@en1
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