18.9.87 Official Journal of the European Communities No C 250/3 
Proposal for a Council Directive instituting a process of convergence of rates of value added tax 
and excise duties 
COM(87) 324 final 
(Submitted by the Commission to the Council on 7 August 1987) 
(87/C 250/03) 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, HAS ADOPTED THIS DIRECTIVE: 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Article 99 
thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Par­
liament, 
Having regard to the opinion of the Economic and 
Social Committee, 
Whereas completing the internal market, which is one of 
the fundamental objectives of the Community, requires 
that fiscal frontiers be abolished. That is to say that the 
system of remission of tax on exportation and the 
imposition of tax on importation and of frontier controls 
on taxable persons as well as on private persons be 
discontinued; 
Whereas the measures to be taken to accomplish that 
objective ought to be spread over a period of time, but it 
is necessary at present to avoid an increase in the existing 
divergence between the fiscal systems of the Member 
States and on the contrary to encourage their 
convergence; 
Whereas, in order to attain this objective, it is necessary 
for the Member States to refrain from altering the 
number and the rates of value added tax; whereas it is 
on the other hand desirable that the Member States 
should, if they wish, be authorized to alter the number 
and the rates of tax which they apply in each situation so 
that the substantial differences that currently exist within 
the Community may be reduced; 
Whereas only the excise duties on tobacco products, 
alcoholic drinks and mineral oils ought to be maintained 
at a Community level; whereas the Member States ought 
therefore to commit themselves not to introduce new 
excise duties or to increase the rates or the scope of 
existing excise duties; whereas it is appropriate, however, 
to allow them to move their main excise duty rates 
towards the Community rates, Article 1 
Value added tax provisions 
1. Standstill 
Pending the adoption of provisions concerning the 
number and level of the rates which will have to be 
applied in the Community in order to permit the 
abolition of the remission of tax on exportation and of 
the imposition of tax on importation in so far as trade 
between Member States is concerned, Member States 
shall refrain from altering the number and level of rates 
which they apply at the date of adoption of this 
Directive, subject to the rights provided for in the 
paragraphs below. 
2. Optional convergence of the number of tax rates 
Member States which apply: 
(a) three rates or more may reduce that number to two 
rates, to be called a reduced rate and a normal rate; 
(b) one rate may increase that number to two rates, to 
be called a reduced rate and a normal rate. 
3. Optional convergence of the tax rates 
Member States may: 
(a) alter the levels of their reduced and normal tax rates 
on condition that they move towards or within the 
following limits: 
(aa) for reduced rates: between 4 % and 9 %, 
(ab) for normal rates: between 14 °/o and 20 %'; 
(b) reduce or abolish their increased tax rates. 
Article 2 
Excise duty provisions 
1. Member States shall refrain from introducing new 
excise duties or indirect taxes which give rise, in trade 
between Member States, to taxation on importation and 
remission,of tax on exportation or to frontier controls. 
No C 250/4 Official Journal of the European Communities 18. 9. 87 
2. Member States shall refrain from increasing the 
rates or enlarging the scope of those excise duties or 
indirect taxes which give rise to taxation on importation 
and remission of tax on exportation or to frontier 
controls. 
3. Paragraphs 1 and 2 shall not apply to the excise 
duties on manufactured tobacco, alcoholic beverages and 
mineral oils. 
4. Pending the adoption of provisions concerning the 
rates and/or amounts of excise duty which will have to 
be applied in the Community in order to permit the 
abolition of import taxation and of export tax remission 
in trade between Member States, the latter may alter the 
rates of excise duty applied to the products set out below 
on condition that they move towards the following levels 
or amounts: 
Alcoholic beverages 
Potable spirits (per hi of pure alcohol): 1 271 ECU, 
Intermediate products (per hi): 85 ECU, 
Wines: 17 ECU, 
Beers per degree Plato per hi: 1,32 ECU. 
Manufactured tobacco 
Cigarettes: specific excise in (ECU per 1 000): 19,5 ECU 
+ ad valorem duty plus VAT 
(as a % of the retail price): between 52 and 54 %; 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Article 99 
thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Par­
liament, 
Having regard to the opinion of the Economic and 
Social Committee, Cigars and cigarillos 
ad valorem duty plus VAT 
(as a % of the retail price): between 34 and 36 %; 
Smoking tobacco 
ad valorem duty plus VAT 
(as a % of the retail price): between 54 and 56 %; 
Other manufactured tobacco 
ad valorem duty plus VAT 
(as a % of the retail price): between 41 and 43 %. 
Mineral oils 
Leaded petrol and medium oils used as propellant per 
1 000 litres: 340 ECU; 
Unleaded petrol per 1 000 litres: 310 ECU; 
Liquified petroleum gas (LPG) per 1 000 litres: 85 ECU; 
Diesel oil per 1 000 litres: 177 ECU; 
Heating gas-oil and medium oils used as fuels other than 
propellants per 1 000 litres: 50 ECU; 
Heavy fuel oil per 1 000 kg: 17 ECU. 
'Article 3 
The Member States shall communicate to the 
Commission the text of all the provisions of national law 
which they adopt in the field covered by this Directive. 
Article 4 
This Directive is addressed to the Member States. 
Whereas Council Directives ... lay down provisions 
relating to the structures of excise duties applicable 
respectively to alcohol, wine, beer and intermediate 
products; 
Whereas for the purpose of establishing an internal 
market without frontiers it is necessary to apply common 
rates of excise duty to each of these products; 
Whereas it is necessary to provide for the periodic 
adjustment of those common rates; 
Whereas a reduced rate should be applied to 
undenatured alcohol used in the preparation of 
perfumes, toiletries and cosmetics; Proposal for a Council Directive on approximation of the rates of excise duty on alcoholic 
beverages and on the alcohol contained in other products 
COM(87) 328 final 
(Submitted by the Commission to the Council on 7 August 1987) 
(97/C 250/04)