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Can the EU force member states to change taxation levels?

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  • 28-05-2008 2:03pm
    #1
    Tabnabs
    Moderators, Recreation & Hobbies Moderators, Sports Moderators Posts: 15,721 Mod ✭✭✭✭


    For example, how is this possible?

    The Chancellor of the Exchequer's Pre-Budget Report presented to Parliament on 5 December 2005 contains the following news at para 7.5.

    "The UK has a number of exemptions from the Energy Products Directive that enable duty to be charged at a reduced rate on oils where they are put to certain uses. These exemptions are due to expire at the end of 2006. While more information will be required to inform the case the UK makes to the European Commission, the Government is minded to apply for an extension of the derogations for fuel used in private air and pleasure craft navigation, liquified petroleum gas (LPG) and natural gas (NG) used as motor fuel, and waste oils reused as fuel. The Government will issue an initial regulatory impact assessment on the effects of ending the derogation for private pleasure craft early next year. This document will then be used as the basis for further information gathering and discussions."


    Ireland, UK, Finland and Malta were all denied extensions to their derogations by the European commission. Is this not the EU forcing a level of taxation (in this case a pan-european standard rate, i.e. full) on its member states? Can we not ignore their ruling?


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    #2
    Scofflaw
    Registered Users Posts: 23,283 ✭✭✭✭Scofflaw


    Dyflin wrote: »
    For example, how is this possible?

    The Chancellor of the Exchequer's Pre-Budget Report presented to Parliament on 5 December 2005 contains the following news at para 7.5.

    "The UK has a number of exemptions from the Energy Products Directive that enable duty to be charged at a reduced rate on oils where they are put to certain uses. These exemptions are due to expire at the end of 2006. While more information will be required to inform the case the UK makes to the European Commission, the Government is minded to apply for an extension of the derogations for fuel used in private air and pleasure craft navigation, liquified petroleum gas (LPG) and natural gas (NG) used as motor fuel, and waste oils reused as fuel. The Government will issue an initial regulatory impact assessment on the effects of ending the derogation for private pleasure craft early next year. This document will then be used as the basis for further information gathering and discussions."


    Ireland, UK, Finland and Malta were all denied extensions to their derogations by the European commission. Is this not the EU forcing a level of taxation (in this case a pan-european standard rate, i.e. full) on its member states? Can we not ignore their ruling?

    The EU has competence over indirect taxes - VAT, duties, customs - which is a result of the EC customs union. It therefore sets minimum and maximum rates, and applicability.

    cordially,
    Scofflaw


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