98/20/EC: Council Decision of 19 December 1997 authorising the Kingdom of the Netherlands to extend the application of a measure derogating from Article 21 of the Sixth Council Directive 77/388/EEC on the harmonisation of the laws of the Member States relating to turnover taxes
Date: 1997-12-19
Institutions: Council of the European Union
Subjects: Netherlands, VAT, approximation of laws, clothing industry, derogation from EU law, subcontracting

L 8/16

EN

Official Journal of the European Communities

14. 1. 98

II

(Acts whose publication is not obligatory)

COUNCIL

COUNCIL DECISION

of 19 December 1997

authorising the Kingdom of the Netherlands to extend the application of a
measure derogating from Article 21 of the Sixth Council Directive 77/388/EEC
on the harmonisation of the laws of the Member States relating to turnover taxes

(98/20/EC)

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 (1), and in particular Article 27 thereof,

Having regard to the previous Decision 92/545/EEC (2),

Having regard to the Commission report on the applica-
tion of Decision 92/545/EEC,

Having regard to the Commission proposal arising from
that report,

Whereas, under Article 27(1) of Directive 77/388/EEC,
the Council, acting unanimously on a proposal from the
Commission, may authorise any Member State to intro-
duce or extend special measures derogating from that
Directive in order to simplify the procedure for charging
tax or to prevent certain types of tax evasion or avoid-
ance;

Whereas, by letter registered at the Commission on 15
November 1996,
the Netherlands
the Kingdom of
requested authorisation to extend the application of the
derogation measure previously granted to it for a limited
period by Decision 92/545/EEC;

Whereas the other Member States were informed on 21
April 1997 of the request from the Kingdom of the
Netherlands;

Whereas the derogation involves collecting from the
ready-to-wear clothing firm the VAT normally due from
the subcontractor under Article 21(1)(a) of Directive 77/
388/EEC;

Whereas the Commission report on the application of
the derogation has shown that the derogation measure
satisfies the conditions for the application of Article 27 of
the said Directive;

Whereas the Commission adopted on 10 July 1996 a
work programme and a timetable of proposal providing
for gradual, step-by-step progress towards a common
VAT system for the internal market;

Whereas, as the final package of proposals is scheduled
for mid-1999, the authorisation is to be granted until 31
December 1999 so as to enable an assessment then to be
made of the derogation measure’s consistency with the
overall approach of the new common system of VAT;

(1) OJ L 145, 13. 6. 1977, p. 1. Directive last amended by Dir-

ective 96/95/EC (OJ L 338, 28. 12. 1996, p. 89).

(2) OJ L 351, 2. 12. 1992, p. 33.

Whereas this derogation will not have an adverse impact
on the Community’s own resources accruing from VAT,

14. 1. 98

EN

Official Journal of the European Communities

L 8/17

HAS ADOPTED THIS DECISION:

Article 2

Article 1

This Decision is addressed to the Kingdom of the Neth-
erlands.

By way of derogation from Article 21(1)(a) of Directive
77/388/EEC, the Kingdom of the Netherlands is hereby
authorised to apply until 31 December 1999 in the
ready-to-wear clothing industry a scheme for shifting the
subcontractors obligation to pay over VAT to the tax
authorities from the subcontractor to the clothing firm
(the contractor).

Done at Brussels, 19 December 1997.

For the Council

The President

F. BODEN