No C 218/12 Official Journal of the European Communities 29. 8. 85 
The essential thing is to ensure uniform treatment, i.e. either 
all supplies or services of similar type should be taxed, or 
none of them. 
The Committee recommends that the arrangements outlined 
in point 2 of Annex E should be incorporated into the 19th 
Directive, thus amending the Sixth Directive by providing for 
the exemption from tax with effect from 1 January 1988 of 
other services performed by doctors and other suppliers of 
prostheses. 
Article 1, Annex E, point 7 situation in the social and health spheres, for example, across 
the board taxation seems more appropriate. In this case the 
amendment proposed in Article 28 (3) (g) would become 
inoperative. 
Article 2, Annex F, points 1, 2 and 9 
The Committee recommends that taxation of these items be 
brought forward to 1 January 1986, as there seem to be no 
compelling grounds for the further postponement of 
harmonization. 
The Committee considers that from 1 January 1988 services 
performed by public radio and television bodies should be 
exempted from tax, notwithstanding the fiscal implications 
for two Member States. 
Article 1, Annex E, point 11 
The Committee considers that harmonization of the turnover 
tax provisions for supplies of buildings that are not newly 
constructed cannot be postponed indefinitely. 
Article 1, Annex E, point 15 
Equal treatment of travel agents' services with respect to 
turnover taxes can be achieved by across the board taxation 
as well as by the extension of exemptions. Given the tax Article 2, Annex F, points 13 and 15 
The Committee suggests that the management of credits and 
credit guarantees by third parties and transactions 
concerning the safekeeping and management of securities 
should continue to be tax-exempt. Otherwise considerable 
demarcation difficulties would in practice arise with regard 
to the management of credits and credit guarantees, in view 
of the continuing and necessary exemption of the arranging 
of credit and the issue of loans on a trust basis. As in the case 
of other typical banking services, the exemption of the 
safekeeping and management of securities is necessary 
basically for social reasons. The taxation of safekeeping and 
management fees would, in particular, be inappropriate 
where shares and other securities evidencing equity 
participation are deposited. This would run directly counter 
to the Commission's efforts to improve the equity situation of 
Community companies through tax incentives. 
Done at Brussels, 3 July 1985. 
The Chairman 
of the Economic and Social Committee 
Gerd MUHR 
Opinion on the proposal for a 19th Council Directive on the harmonization of the laws of the Member 
States relating to turnover taxes, amending Directive 77 / 3 8 8 / EEC - common system of value added 
taxO) 
(85/C 218/07) 
Procedure 
On 18 December 1984 the Council, acting pursuant to Article 100 of the EEC Treaty, asked the 
Economic and Social Committee for an opinion on the abovementioned proposal. 
(») OJ No C 347, 29. 12. 1984, p. 5. 
29. 8. 85 Official Journal of the European Communities No C 218713 
The Section for Economic and Financial Questions was instructed to prepare the Committee's opinion 
on the matter. The section adopted its opinion on 23 April 1985. The rapporteur, Mr Broicher, gave 
an oral report. 
The Committee adopted the following opinion at its 228th plenary Session (meeting of 3 July 1985) by 
a majority vote with one abstention: 
1. General comments 
The Committee welcomes the measures proposed by the 
Commission, bearing in mind that it has emerged over past 
years that in many cases the adoption of identically phrased 
legal provisions has not, by itself, brought about uniformity. 
Where legal instruments are interpreted in different ways the 
application of the law is bound to be different. The 
Commission's endeavours to bring about the full 
harmonization of the common VAT system by applying the 
same legal interpretations throughout the Member States 
should be emphatically pursued. 
In this context, the Committee considers it advisable to set 
out the currently applicable provisions of the various VAT 
Directives in a new Sixth VAT Directive, thereby providing 
greater transparency and facilitating implementation. the provision of services and reimbursement. In the case of 
diagnostic and therapeutic treatment, for example, the level 
of reimbursement would have to be that recognized or agreed 
by the sickness insurance bodies. In this context private 
hospitals and public law hospitals would be placed on an 
equal footing. 
Article 1, point 3 (b) 
In the revised version of Article 13 A (1 m) it should be 
expressly stipulated, with regard to the exemption of services 
linked to sport or physical education, that concessions are 
not to be accorded to professional sport or physical 
education provided in fitness centres or similar 
institutions. 
2. Specific comments 
Article 1, point 3 (a) 
It is stated in point 4 of the explanatory memorandum 
referring to Article 1 that the hitherto limited exemption of 
hospital services has given rise to problems of definition. 
These are to be avoided by providing a blanket exemption for 
hospital and medical care and closely related activities 
undertaken by hospitals and similar bodies. These similar 
bodies are to include 'other duly recognized establishments of 
a similar nature'. This imprecise term may give rise to 
difficulties with regard to practical application. It is not very 
easy to know where to draw the line in this context between 
therapeutic treatment and, for example, purely cosmetic 
treatment. The blanket exemption of hospital treatment 
would also mean that no turnover tax would be levied on the 
services provided by sanatoria, which are basically involved 
only in providing facilities for convalescence. Such an 
exemption is hardly justifiable on social grounds. The 
Committee therefore believes that blanket exemption of 
hospital treatment is not the right approach. A dividing line 
should continue to be drawn between those services liable to 
taxation and the exempted services, the distinction being 
based on the criteria established hitherto. 
In order to avoid problems of interpretation, these criteria 
should be clarified by stipulating the conditions governing Article 1, point 3 (d) 
The exemption in respect of the supply of works of art by 
artists themselves will certainly promote direct sales by artists 
to final customers not entitled to deduct tax. Such an 
exemption will, however, at the same time bring about 
distortions in competition between works supplied by artists 
themselves and works supplied by the art trade, thereby 
placing young artists in particular at a disadvantage. If only 
for this reason special status should not be granted to artists. 
The exemption of services provided by artists would also not 
appear to be necessary as the performances themselves 
(theatre presentations, concerts, etc.) are exempted. It would 
not appear to be right to make prior services exempt from 
turnover tax. Once a precedent has been set in this case, it 
may give rise to a flood of similar possible exemptions. 
Bearing in mind the taxation of other supplies and services, 
particularly those in the medical and social fields, special 
treatment for the supply of works of art and the provision of 
services by artists does not appear to be justified. 
Irrespective of the justification of exempting these items, the 
Committee would stress the difficulties of definition which it 
believes will arise. If supplies of works of art are to be 
exempted, tax officials will have to decide what is a work of 
art. In addition to this general problem of definition there is 
also the difficulty of distinguishing between, for example, 
handicrafts and applied art. In the Committee's view 
turnover tax law should not have to bear the additional 
burden of these technical problems unless there are pressing 
reasons why this should be so. 
No C 218/14 Official Journal of the European Communities 29. 8. 85 
Article 1, point 4 
The right of option provided for under Article 13 C of 
Directive 77/388/EEC in respect of financial institutions 
which issue credit cards or similar documents does not, in the 
Committee's view, lead to a distortion in competition. The 
imposition of a restriction is therefore not justified. The 
Done at Brussels, 3 July 1985. 
1. The Committee approves the Council's proposal for 
a Regulation empowering the European Monetary 
Cooperation Fund (EMCF) to grant to the central banks of 
non-member countries and international monetary 
institutions the status of 'other holders' of ECU. 
2. The Committee is glad to see the Community 
committing itself, through this proposal, to greater 
international monetary cooperation based on the European 
Monetary System (EMS) and the ECU. It trusts that the 
procedures enabling 'other holders' to use ECU are 
progressively extended and liberalized, so that the ECU can 
become an international reserve currency and a common 
currency. 
3. The Committee would stress that some of the measures 
taken recently to strengthen the ECU (raising interest rates 
on ECU holdings, use of ECU to influence the US dollar or 
(J) OJ No C 171, 10. 7. 1985, p. 7. difficulties referred to in the explanatory memorandum are 
basically due to the fact that different views prevail in the 
various Member States as to whether these services are to be 
classified as credit or advertising services. The only way to 
achieve a satisfactory solution to this problem is by 
establishing a uniform definition of these terms throughout 
the EC. 
Community currencies) are a positive step towards the 
official ECU being used more, and will help promote the 
creation of a European monetary area, as the Committee has 
suggested on many occasions in the past. 
The Committee also feels that further measures should be 
taken to strengthen economic convergence and relaunch the 
process of financial integration (liberalization of capital 
movements, exchange controls, etc.) so as to consolidate the 
stability, credibility and identity of the EMS. 
4. In view of the Commission's wish that strengthening 
the ECU should become an objective of the utmost priority, 
the Committee would like to take this opportunity to draw 
the Council's attention to the proposals contained in the 
information report of the Section for Economic and Financial 
Questions on the EMS, which can be summarized as 
follows: The Chairman 
of the Economic and Social Committee 
Gerd MUHR 
Opinion on the proposal for a Council Regulation amending Article 2 of Council Regulation (EEC) 
No 3181/78 as regards the use of ECU by 'other holders' (*) 
(85/C 218/08) 
On 10 June 1985, the Council decided, in accordance with Article 198 of the Treaty establishing the 
European Economic Community, to ask the Economic and Social Committee for an opinion on the 
abovementioned proposal. 
The Section for Economic and Financial Questions, which was made responsible for the preparatory 
work on this matter, adopted its opinion on 18 June 1985. Mr Drago was rapporteur, and 
Mr De Bievre and Mr Goris were co-rapporteurs. 
At its 228th plenary session (meeting of 4 July 1985), the Economic and Social Committee adopted the 
following opinion unanimously: