HL Deb 27 May 1999 vol 601 cc99-100WA
Lord Stoddart of Swindon

asked Her Majesty's Government:

Further to the Written Answer by the Lord McIntosh of Haringey on 17 May (WA 1), whether they will now make it clear that they will not agree to any European Union proposals for a withholding tax which risks serious damage to United Kingdom financial markets as distinct from European Union financial markets. [HL2633]

Lord McIntosh of Haringey

The Government will not agree to any Directive which would risk serious damage to the financial services industry in the City of London. We have already made it clear on a number of occasions that the draft Directive is not acceptable in its present form.

Lord Stoddart of Swindon

asked Her Majesty's Government:

Further to the Written Answer by the Lord McIntosh of Haringey on 17 May (WA 1)—

  1. (a) whether parliamentary scrutiny arrangements can prevent them from agreeing to any proposal by the European Council for a withholding tax;
  2. (b) whether, following such an agreement, there would be a breach of European Community law if the necessary tax legislation was not enacted in the United Kingdom; and
  3. (c) whether such a breach would undermine both Parliament's control of supply and the constitutional principle that one Parliament cannot bind its successors. [HL2634]

Lord McIntosh of Haringey

There are long-standing government undertakings to both Houses of Parliament that they will not normally vote in favour of (or in some cases abstain from voting on) proposals in the Council of Ministers which are still subject to the established parliamentary scrutiny arrangements. The undertakings are embodied in a 30 October 1980 Resolution of the House of Commons (updated on 24 October 1990).

A failure to give effect to an obligation to transpose the provisions of an EC Directive would be a breach of our obligations under the EC Treaty, and would render the United Kingdom liable to infraction proceedings under Article 226 (ex-Article 169).

The European Communities Act 1972 provides for effect to be given in our domestic law to obligations of the United Kingdom under EC law, including, where necessary, for those obligations to override inconsistent provisions of our domestic law.