WRITTEN QUESTION No. 3878/98 by Philippe DE COENE Abolition of duty-free
Date: 1999-01-04
Institutions: DE COENE, European Parliament
Subjects: European Commissioner, European Union, VAT, diplomatic profession, duty-free sale, equal treatment, excise duty, tax exemption













EUR-Lex - 91998E3878 - EN






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91998E3878

WRITTEN QUESTION No. 3878/98 by Philippe DE COENE Abolition of duty-free  


Official Journal C 325 , 12/11/1999 P. 0035 





WRITTEN QUESTION E-3878/98by Philippe De Coene (PSE) to the Commission(4 January 1999)Subject: Abolition of duty-freeA decision was taken in 1991 to abolish duty-free shopping within the European Union with effect from 1 July 1999. Only travellers to destinations outside the Union would be able to continue to benefit from duty-free.However, I learn that even after 1 July 1999 the members of the Commission will retain the right to buy a number of goods duty-free: 20 000 cigarettes, 400 litres of alcohol of less than 21 % proof, 90 litres of whisky or vodka, 5 000 litres of cheap petrol for their first car and 2 000 litres for their second car.Does the Commission not feel that its members should be subject to the same rules as ordinary citizens of the Union and that they should therefore no longer be entitled to duty-free goods?Does the Commission intend to do away with this derogation?Answer given by Mr Monti on behalf of the Commission(9 March 1999)Up to 30 June 1999, exemption from VAT and excise duty on intra-Community duty-free sales is granted under Article 28k of Directive 91/680/EEC of 16 December 1991 and Article 28 of Directive 92/12/EEC of 25 February 1992 respectively.Belgium treats the Members of the Commission as diplomats and accordingly they enjoy certain financial benefits like any diplomat from another country serving in that Member State and any other persons afforded similar treatment. One of these privileges is the right to purchase duty-free goods for personal use provided that the total bill is at least BEF 10 000 (VAT not included) and within the annual purchasing limit for the following products (1998 figures: purchasing conditions are laid down each year by the Belgian Ministry of Finance).>TABLE>Tax provisions relating to diplomats are to be found in particular in Article 34 of the Vienna Convention of 18 April 1961, which lays down that " A diplomatic agent shall be exempt from all dues and taxes, personal or real, national, regional or municipal, except: (a) indirect taxes of a kind which are normally incorporated in the price of goods or services..." As a rule, however, it is customary for all countries to grant such exemptions in international relations.At Community level, the tax benefits in question are covered by specific provisions: VAT by the first indent of Article 15(10) of Directive 77/388/EEC; excise duties by the first indent of Article 23(1) of Directive 92/12/EEC; customs duties by Article 133(1)(b) and (c) of Regulation (EEC) 918/83. As the Honourable Member has stated, there is no time limit set by the legislation. Thus, if the relevant Community legislation is not amended, it will remain in force even after 1 July 1999.The Commission has asked itself whether the tax exemptions (VAT and excise duties) granted to Member States' diplomats serving in the Union and persons treated in the same way, such as Members of the European Commission, are compatible with the Union's progress towards integration. The Commission has decided to make an in-depth evaluation of the situation with a view to identifying what legislative initiatives would be appropriate.