HL Deb 17 March 1997 vol 579 cc47-8WA
Lord Pearson of Rannoch

asked Her Majesty's Government:

Whether in its document COM 328(96) Final the European Commission has proposed: (a) a uniform system of VAT throughout the European Community, and (b) that the power to impose VAT under such a uniform system at rates between 15 per cent. and 25 per cent. should be ceded by member states to the VAT Committee in Brussels; and whether, if those proposals are adopted, the United Kingdom would lose its present derogation to impose a zero VAT rate on food, children's clothes, books and newspapers, transport fares and new buildings, including houses.

The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish)

In its document COM 328(96) the European Commission outlines a suggested programme for progress towards a so-called "common system" of VAT to apply throughout the European Community. The programme, which contains no specific legislative proposals, envisages a substantial degree of harmonisation of rates, and a substantially enhanced role for the VAT Committee. The programme does not specifically propose that the VAT Committee should have the authority to fix VAT rates. The Government would be opposed to any such idea. It believes that unanimity in the Council should remain the basis for all decision-making on EC VAT matters. The UK's zero rates are fully safeguarded under existing EC agreements. Any change to the EC VAT system requires the unanimous agreement of member states, and so there is no question of the UK being forced to give up any of its zero rates.

Lord Pearson of Rannoch

asked Her Majesty's Government:

Whether at the Inter-Governmental Conference they will veto any proposals which might modify the requirement for unanimity among member states before a common system of VAT could be adopted by the European Communities.

Lord Mackay of Ardbrecknish

In the White Paper on the Inter-Governmental Conference, published last March, the Government made clear that we will oppose the extension of qualified majority voting. This includes VAT matters.

Lord Pearson of Rannoch

asked Her Majesty's Government:

Whether at the Inter-Governmental Conference they will resist any extension of the Qualified Majority Vote on matters affected by Article 99 of the Treaty on European Union and Article 35 of the sixth VAT Directive, and if so, whether they believe they will succeed in that resistance, and why.

Lord Mackay of Ardbrecknish

In the White Paper on the Inter-Governmental Conference, published last March, the Government made clear that we will oppose the extension of qualified majority voting. This includes VAT matters covered by Article 99. As decisions taken at the end of the Inter-Governmental Conference will themselves be subject to unanimity no change to the Treaty can be made without our agreement.