§ Lord Kimball
asked Her Majesty's Government:
What was the outcome of the latest meeting of the European Community's Economic and Finance Council.
The Paymaster General (The Earl of Caithness)
The ECOFIN Council met in Luxembourg on 11 th June. Future progress towards economic and monetary union was discussed and oral reports were heard from the Chairman of the Central Bank Governors, Monetary and Economic Policy Committees and from President Delors. The council agreed that it was important to ensure that Stage 1 was successful and that more work was needed on how the Community might progress beyond that stage. It was agreed that finance ministers should be involved in the forthcoming intergovernmental conference on EMU. The Presidency will submit a progress report to the European Council before its meeting on 25th/26th June.
Political agreement was reached on a package of three corporate tax measures to encourage cross-border co-operation. When finally implemented, these measures will end the double taxation of subsidiaries who transfer dividends to a parent company in another member state and will remove the tax discincentive to cross-border 398WA mergers. This is a very welcome step forward and will be of real benefit to British industry.
The council also welcomed a report from the Commission on the main features of its new proposals for a system of VAT control and for the collection of intra-EC trade statistics after 1992. The raising of travellers' allowance was also discussed. It was agreed that the Court of Auditors' report on export refunds should be submitted to the Committee of Permanent Representatives for urgent further consideration. The investment services directive was also discussed, and it was concluded that the council should aim to reach a common position on the directive by 31st December 1990.