§ Mr. Teddy TaylorTo ask the Chancellor of the Exchequer when he expects the European Court of Justice to announce its decision in the case taken by the European Economic Community Commission on 15 September against the United Kingdom regarding the levies of value added tax on new households, gas, electricity, water, sewerage and other services.
§ Mr. LilleyPursuant to my reply of 9 November 1987 at column64, the Advocate General has now delivered his opinion on the zero-rates infraction case in the European Court of Justice. The opinion is only advisory and does not form part of the court's judgment.
The court will base its final judgment on the full pleadings, both written and oral, of the two parties. This is expected to be delivered early in the new year. We shall need to see and study in detail the precise term of the court's judgment which is of course binding on the United Kingdom before any implications for policy become clear.
The Government have vigorously contended that the zero rates disputed by the Commission are consistent with European Community law.
The case is entirely separate from the Commission's new proposals on indirect tax approximation presented to the ECOFIN Council which Lord Cockfield made public recently and which cannot be adopted without unanimous agreement by the Council of Ministers. In this context, my right hon. Friend the Chancellor has made clear, both in the House and elsewhere, that the Government will not permit to come into force any proposals that in any way conflict with the pledges we have given concerning the United Kingdom's zero rates of VAT.