House of Lords

Session 1998-99 Publications on the internet European Communities Committee Publications

European Communities - Fifteenth Report Here you can browse the report which was ordered by the House of Lords to be printed 20 July 1999. CONTENTS REPORT PART 1 INTRODUCTION PART 2 SUMMARY OF THE OPINION OF THE COMMITTEE The major issue The proposals on the table: direct taxation The proposals on the table: indirect taxati Ideas for the longer term Concluding comments PART 3 THE MAJOR ISSUES What is tax co-ordination? What is tax competition? When is it harmful? Does the Single Market require more tax co-ordination? Will progress on the Single Market for financial services require more tax co-ordination? Does EMU require more tax co-ordination? Is it sensible to consider tax co-ordination limited to European Union Member States? Would tax co-ordination necessitate centralised control? Would increased tax co-ordination lead to a higher tax burden? Does the present tax system contribute to high levels of unemployment? Could tax changes be imposed on the United Kingdom? PART 4 THE PROPOSALS ON THE TABLE Direct taxation: the package to tackle harmful tax competition The Code of Conduct Does the Code of Conduct approach endanger unanimity? Secrecy Effect on dependent territories Relationship with State aid measures Taxation of interest and royalty payments between associated companies The proposal to ensure a minimum of effective taxation of savings income in the form of interest payments (the "withholding tax" proposal) The previous proposal The present proposal The arguments for and against the proposal The special case of Eurobonds, and the effect on the City of London Would the reporting option solve the problems? Possible compromise measures Indirect taxation VAT proposals Introduction of maximum standard rate of VAT Lower rate of VAT on labour-intensive services Reform of the VAT committee Mutual assistance in debt recovery Right to deduct VAT General issues Energy taxation Excise duties PART 5 THROUGH A GLASS DARKLY: IDEAS FOR THE LONGER TERM Reform of the system of corporate taxation Reform of the Value Added Tax system PART 6 CONCLUDING COMMENTS Appendix 1—Membership of Sub-Committee A Appendix 2—List of witnesses Appendix 3—Glossary NOTE: Pages of the Report are numbered in bold type, pages of evidence are numbered in ordinary type. References in the text of the Report are as follows: refers to a question in oral evidence.   (p)  refers to a page of written evidence. ORAL EVIDENCE Mr Ian Menzies-Conacher, Group Taxation Director and Mr Malcolm Levitt, Group EU Adviser, Barclays Bank plc Written evidence Oral evidence, 16 March 1999 Mr Tim Sweeney, Director General, British Bankers' Association, and Mr Cliff Dammers, International Primary Market Association Written evidence Oral evidence, 16 March 1999 Mr Alastair Clark, Executive Director, Financial Stability and Mr Alex Bowen, Head of Financial Intermediaries Division, Bank of England Written evidence Oral evidence, 23 March 1999 Supplementary written evidence Ms Judith Mayhew, Chairman of the Policy and Resources Committee, Corporation of London Written evidence Oral evidence, 30 March 1999 Mr Colin Mowl, Deputy Director, Budget and Public Finances Directorate, Mr Peter Curwen, Head of EU and International Tax Team, HM Treasury, Mr Julian Reed, Assistant Director, Financial Institutions Division and Mr Simon Morys, Policy Adviser, European Union Division, Inland Revenue Written evidence Oral evidence, 20 April 1999 Supplementary written evidence Mr Graham Mather MEP, President, European Policy Forum Written evidence Oral evidence, 27 April 1999 Dr Hans Ulrich Kieschke, Head of Directorate for International Tax Policy, Mr Heinz-Jurgen Selling, Head of Division and Mr Ulrich Wolff, Head of Division, Federal Ministry of Finance, Federal Republic of Germany Written evidence Oral evidence, 11 May 1999 Dr Ulrich Bosch, Deutsche Bank AG Written evidence Oral evidence, 11 May 1999 Commissioner Mario Monti, Acting Commissioner for Internal Market, Financial Services, Customs and Indirect and Direct Taxation, European Commission Oral evidence, 13 May 1999 Monsieur le Floc'h-Louboutin, Director of Tax Legislation, Ministry of Finance, France Oral evidence, 18 May 1999 Dr Jeffrey Owens, Head of Fiscal Affairs, Organisation for Economic Co-operation and Development Written evidence Oral evidence, 18 May 1999 Mr Richard Baron, Deputy Head, Policy Unit, Institute of Directors Written evidence Oral evidence, 25 May 1999 Mr Peter Agar, Deputy Director General, Mr Nicholas Dee, Chairman of the Tax Committee and Mr Philip Gillett, Chairman of the International Tax Sub-Committee, Confederation of British Industry Written evidence Oral evidence, 25 May 1999 Mr Colin Mowl, Deputy Director, Budget and Public Finances Directoate, HM Treasury; Mr Martin Brown, Commissioner and Director, VAT Policy Directorate, Mr Kris Romanski, Head of VAT Strategy and International Division, and Mr Mike Wells, Head of the EU Team, HM Customs & Excise Written evidence Oral evidence, 8 June 1999 Supplementary written evidence by Inland Revenue and HM Treasury Supplementary written evidence by Inland Revenue and HM Customs & Excise Professor Michael Devereux, Mr Malcolm Gammie and Mr Peter Wilmott Written evidence (Professor Devereux) Written evidence (Mr Malcolm Gammie) Written evidence (Mr Peter Wilmott) Oral evidence, 17 June 1999 Ms Dawn Primarolo MP, Paymaster General, HM Treasury, Mr Colin Mowl, Deputy Director, Budget and Public Finances Directorate, HM Treasury and Mr Peter Michael, Director of EU Taxation, Inland Revenue Oral evidence, 22 June 1999 WRITTEN EVIDENCE Association of British Insurers Government of Bermuda Food and Drink Federation Government of the Republic of Ireland Mr Karel Lannoo London Stock Exchange National Association of Cider Makers Newspaper Society

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