Proposal for a COUNCIL DECISION amending Council Decision 97/510/EC authorizing Ireland to apply a measure derogating from Article 21 of the Sixth Directive (77/388/EEC) on the harmonization of the laws of the Member States relating to turnover taxes

(presented by the Commission)

EXPLANATORY MEMORANDUM

1. Under Article 27 of the Sixth Council Directive of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes - Common system of value added tax: uniform basis of assessment, [1] the Council, acting unanimously on a proposal from the Commission, may authorise any Member State to introduce special measures for derogation from the provisions of the Directive, in order to simplify the procedure for charging the tax or to prevent certain types of tax evasion or avoidance.

[1] OJ L 145, 13.6.1977, p.1. Directive last amended by Directive 2002/93/EC (OJ L 331, 7.12.2002, p.27 and OJ L 18, 23.1.2003, p.55).

2. As a rule, such authorisations are given on a temporary basis, so that an assessment can be made after a few years as to whether the special measures are appropriate and effective.

3. The Decision 97/510/EC [2] taken by the Council under Article 27 of the Sixth Directive authorised Ireland to apply a measure derogating from Article 21 of the Directive to allow it to combat tax evasion and tax fraud in the real-estate sector. The Decision 2000/435/EC [3] extended this exemption to 31 December 2003, when it will expire.

[2] OJ L 214, 6.8.1997, p.37.

[3] OJ L 172, 12.7.2000, p.24.

4. By letter received by the Secretariat-General on 4 July 2003, Ireland requested authorisation to extend application of these measures by further four years.

5. In accordance with Article 27(3) of the Sixth Directive, the Commission informed the other Member States by letter of 9 July 2003 of the request made by Ireland.

6. In the Commission's view, the matters of law and of fact which justified the application of the special measures in question have not changed and still pertain.

7. In view of the above, the Commission considers that the request for extension made by Ireland should be granted and that the Decision referred to above should therefore be extended to 31 December 2007.

Proposal for a COUNCIL DECISION amending Council Decision 97/510/EC authorizing Ireland to apply a measure derogating from Article 21 of the Sixth Directive (77/388/EEC) on the harmonization of the laws of the Member States relating to turnover taxes

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community,

Having regard to the Sixth Council Directive (77/388/EEC) of 17 May 1977 on the harmonisation of the laws of the Member States relating to turnover taxes - Common system of value added tax: uniform basis of assessment, [4] and in particular Article 27 paragraph 1 thereof,

[4] OJ L 145, 13.6.1977, p.1. Directive last amended by Directive 2002/93/EC (OJ L 331, 7.12.2002, p.27 and OJ L 18, 23.1.2003, p.55).

Having regard to the proposal from the Commission [5],

[5] OJ C [...], [...], p.[...]

Whereas:

(1) By letter received by the Secretariat-General of the Commission on 4 July 2003 Ireland requested the extension of Decision 97/510/EC [6] authorising it to apply a measure derogating from Article 21 of the Sixth Directive which enabled it to combat tax evasion and tax fraud in the real-estate sector until 31 December 2007.

[6] OJ L 214, 6.8.1997, p.37.

(2) The matters of law and of fact which justified the application of the special measures in question have not changed and still pertain.

(3) The authorisation should therefore be extended until 31 December 2007.

(4) The derogation in question has no impact on the European Communities' own resources from valued added tax,

HAS ADOPTED THIS DECISION:

Article 1

In Article 1 of Decision 97/510/EC, the date 31 December 2003 is replaced by 31 December 2007.

Article 2

This Decision is addressed to Ireland.

Done at Brussels,

For the Council

The President