WRITTEN QUESTION No. 2363/97 by Kirsi PIHA to the Commission. Harm caused by cessation of duty-free sales
Date: 1997-07-10
Institutions: European Parliament, PIHA
Subjects: Finland, Sweden, duty-free sale, economic consequence, ferryboat, labour market, maritime transport, transport infrastructure













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91997E2363

WRITTEN QUESTION No. 2363/97 by Kirsi PIHA to the Commission. Harm caused by cessation of duty-free sales  


Official Journal C 134 , 30/04/1998 P. 0004 





WRITTEN QUESTION E-2363/97 by Kirsi Piha (PPE) to the Commission (10 July 1997)Subject: Harm caused by cessation of duty-free salesThe European Union has decided that duty-free sales within the territory of the Union are to cease in July 1999. If this decision is implemented, it will probably have serious knock-on effects both on transport policy and on employment.The practical grounds for the decision to halt duty-free sales are flimsy, particularly from the point of view of Finland and Sweden. The decision was taken before these two countries joined the Union. However, the views of Finland and Sweden would have been very important in this decision-making process, since nowhere else in the Union is there so much car ferry traffic as in those two countries.Finnish and Swedish ferry companies derive about a third of their revenue from duty-free sales. It may thus justifiably be said that duty-free sales maintain numerous and frequent ferry services. If these sales cease, there will be fewer ferry routes and crossings, unemployment will rise in the region and journeys, including those by truck, will take longer.In view of the above arguments, what will the Commission do to obtain further information about the adverse consequences of halting duty-free sales?Answer given by Mr Monti on behalf of the Commission (17 October 1997)The decision to put an end to duty-free sales to travellers inside the Community was taken by the Council in 1991.At that time the Council decided to allow intra-Community duty-free sales to continue until 30 June 1999 in order to enable the businesses affected to prepare gradually for the new situation. Member States were to take account of developments in transport infrastructures and of the interests of traders operating on a duty-free basis.The Commission would like to point out that, at the time of accession of Sweden and Finland, this decision constituted part of the Community acquis. This is reflected in the special treatment granted to the Åland Island under the Accession Treaty.It is worth noting that no new arguments in support of a study of the consequences of the abolition of duty-free sales have been advanced compared to those put forward in 1991 and which lead to the decision taken by the Council to grant a transitional period.As indicated in previous answers to parliamentary questions on the same topic, the Commission is not planning to conduct a study.The Commission would like to remind the Honourable Member that, even without the tax advantage, sales opportunities will still exist at airports and on ferries. Indeed, businesses were expected to utilise fully the transitional period before abolition to exploit continued sales opportunities provided by a relatively captive market. In any case, it is often expensive, non-targeted and in some cases discriminatory to subsidise certain means of transport by way of a tax exemption. As for duty-free sales, these will continue to be available, by virtue of export, to people travelling to third countries or to territories excluded from the territorial application of the Community provisions in this field.