WRITTEN QUESTION No. 1976/98 by Graham MATHER to the Commission. Reduced rats of VAT under the Sixth VAT Directive
Date: 1998-06-30
Institutions: European Parliament, MATHER
Subjects: VAT, VAT rate, church, heritage protection, maintenance, monument, provision of services, tax harmonisation













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91998E1976

WRITTEN QUESTION No. 1976/98 by Graham MATHER to the Commission. Reduced rats of VAT under the Sixth VAT Directive  


Official Journal C 031 , 05/02/1999 P. 0109 





WRITTEN QUESTION E-1976/98by Graham Mather (PPE) to the Commission(30 June 1998)Subject: Reduced rats of VAT under the Sixth VAT DirectiveUnder the Sixth VAT Directive, the Member States may, exceptionally, apply reduced rates of VAT of not less than 5 % to certain goods and services which should be specified in an Annex to the Directive.The General Synod in the UK is currently seeking to have a reduced rate of 5 % applied to church maintenance and repair work, particularly for church schools and historic buildings.The British Government has quoted the fact that such services do not appear in the list annexed to the Directive as the principal reason why the chances of such a reduced rate being introduced are remote.Given that the case for applying a reduced rate of VAT in these circumstances is a strong one, not least in terms of the benefits it would bring for the preservation of cultural heritage.1. Does the Commission consider that a reduced rate of VAT for repair work carried out on church buildings could, in principle, be added to the relevant Annex to the Sixth VAT Directive?2. Does the Commission envisage doing so in the coming months?3. Does the Commission have any other comments to make on this matter?Answer given by Mr Monti on behalf of the Commission(17 July 1998)The situation under current Community VAT legislation is that category 9 of Annex H of the sixth Council Directive 77/388/EEC of 17 May 1977 on the harmonization of the laws of the Member States relating to turnover taxes - common system of value added tax: uniform basis of assessment(1) covers the "supply, construction, renovation and alteration of housing provided as part of social policy". Member States may therefore allocate a reduced VAT rate of no less than 5 % to these services. Church building work is not listed for the application of a reduced VAT rate but the United Kingdom is entitled to keep, for a transitional period, the existing zero-rate on some work in this area.It would be premature at this stage to comment on the future treatment for VAT of maintenance and repair of churches. A Commission proposal on the harmonisation of VAT rates will, however, be tabled by the end of 1998 at the earliest and it will inter alia tackle this question.The Commission has also released a communication(2) relating to the experimental and optional application of reduced VAT rates to selected labour-intensive services. It is generally believed that this experiment should only encompass a strictly limited number of services which are best suited to meet the criteria set out in the communication. Maintenance and repair of churches and historic buildings are, at least partly, taken into account in the Commission communication. This communication is still under discussion in Council and discussion so far has been inconclusive.(1) OJ L 145, 13.6.1977.(2) SEC(97) 2089 final.