WRITTEN QUESTION P-0544/01 by Mario Mantovani (PPE-DE) to the Commission. Measures to improve taxation for the third system.
Date: 2001-02-19
Institutions: European Parliament, Provisional data
Subjects: Italy, VAT rate, competition policy, derogation from EU law, non-commercial sector, services of general interest, tax exemption, tax harmonisation

21.8.2001

EN

Official Journal of the European Communities

C 235 E/223

(2001/C 235 E/261)

WRITTEN QUESTION P-0544/01

by Mario Mantovani (PPE-DE) to the Commission

Subject: Measures to improve taxation for the third system

(19 February 2001)

On 12 February 1999 the Italian Government signed a Protocol of Understanding with the Third System
Forum with a view to formally recognising the non-profit sector.

As indicated in the Protocol, the Italian Government intends to:

(cid:129) consolidate a policy to promote the third system, also encompassing specific measures for southern

Italy;

(cid:129) launch a policy to provide the proper incentives for a commitment

to the employability of

disadvantaged workers;

(cid:129) launch a promotion policy to capitalise on the whole fund of experience to be tapped in the different
groupings into which the third system breaks down, namely collective organisations, the social
cooperative movement, the voluntary sector, NGOs, mutual societies, and citizens(cid:146) action groups.

Having regard to these aims, the Italian Government maintains that, in addition to the other commitments,
it has taken steps, starting on the date on which the Protocol was initialled, with a view to:

(cid:129) giving full and rapid effect to the provisions extending the concessions and incentives already provided
for SMEs (small and medium-sized enterprises) to cover non-profit-making social enterprises, including
support for the promotion and development (cid:145)agencies(cid:146) sponsored by the third system;

(cid:129) assessing, also at European level, whether more favourable tax treatment might be applied as regards

VAT, as and where necessary;

(cid:129) setting up the supervisory body (the (cid:145)third system authority(cid:146)) within a month of the date of adoption

of the relevant provision, which was linked to the 1999 Finance Act.

Can the Commission say what action has been taken by the Italian Government to fulfil the promise to
promote a Europe-wide campaign in support of tax relief for those who aid non-profit-making initiatives
to show social solidarity?

Would it also be possible to draw up a recommendation based on Article 128 in order to gear national
laws towards better VAT relief, given that the present VAT arrangements are deterring the third system
from performing its natural role of providing services to the public in place of the State?

Answer given by Mr Bolkestein on behalf of the Commission

(23 March 2001)

The Commission is not aware of any action of this nature taken by the Italian Government to implement
the suggestions made in the Protocol referred to by the Honourable Member.

With regard to the second question, Value Added Tax, as set out in 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 (cid:129)
Common system of value added tax: uniform basis of assessment (1),
is a broad-based tax on the
consumption of goods and services by the final consumer. Its broad coverage is to ensure a neutral impact
on the various stages in the supply chain. Nevertheless, Article 13A of the Directive contains a common
list of exemptions allowing the non-taxation of certain activities. These exemptions are broadly consistent
across all the Community to ensure uniform application and are defined narrowly to limit any distortion
to competition that they may cause. Examples include health, welfare, education and some non-profit
making activities.

C 235 E/224

Official Journal of the European Communities

EN

21.8.2001

The Commission(cid:146)s current strategy with regard to the improvement of the operation of the tax is set out in
its communication to the Parliament and Council (2). The principle objectives here are simplification,
modernisation, a more consistent application and better administrative co-operation. Any extension to the
existing arrangements with regard to exemption is unlikely to be consistent with these aims. Exemptions
encourage distortions to competition, increase the compliance costs for businesses and introduce (cid:145)hidden
tax(cid:146) into the supply chain, due to the non-deductibility of related tax on purchases.

However, relief in the form of reduced VAT rates is currently available for a trial three-year period in
respect of certain labour intensive activities (3). Under this provision, Italy was authorised to apply a reduced
VAT rate to services such as (cid:145)renovation and repairing of private dwellings(cid:146) and (cid:145)domestic care services(cid:146).
This is a very limited experimental exercise to see whether providers of these services can benefit from
a reduced rate without risk to the proper operation of the internal market and tax neutrality. Nevertheless,
a final decision on the VAT rate applicable to labour intensive services will not be taken before the
Commission has reported fully on the impact of the exercise at the end of its trial period in December
2002.

(1) OJ L 145, 13.6.1977.
(2) COM(2000) 348 final.
(3) Council Decision 2000/185/EC, 28 February 2000 (OJ L 59, 4.3.2000).

(2001/C 235 E/262)

WRITTEN QUESTION P-0545/01

by Mario Mastella (PPE-DE) to the Commission

(19 February 2001)

Subject: European ban on the consumption and export of Italian (cid:145)bistecca alla fiorentina(cid:146)

in response to the proposals
On 7 February 2001, the Standing Veterinary Committee in Brussels,
published on the same day by the Commission concerning the removal of the vertebral column from all
cattle over 12 months old, decided to ban Italian (cid:145)fiorentina(cid:146) (T-bone) steaks. Member States that can prove
they have taken effective control measures will be exempted from the requirement to remove and destroy
the vertebral column of animals over 12 month old. Furthermore, Sweden, Finland and Austria will be
exempt from the requirement on the grounds that they have not registered any native cases of BSE to date
and are regarded as countries where the disease is unlikely to be present. But the exemption is also being
extended to the United Kingdom, the country in which the first cases of the disease were recorded and
which also has the highest number of confirmed cases of BSE and vCJD (the variant that affects human
beings), as the ban on allowing any animal over 30 months old to enter the food chain is supposedly
sufficient to ensure that the number of animals that could be infected is small and constantly decreasing.
The exemption will not, however, make it possible to export bone-in beef from that country. The
exemption will also apply to Portugal by virtue of the national measures in force to eradicate BSE, and
in particular the ban on meat and bone meal that has been in place since July 1999. But the exemption
will apply only to animals born after that date and under 30 months old.

In view of the foregoing,

(cid:129) Would the Commission clarify the points referred to above and establish whether or not the decisions
taken by the Veterinary Committee were discriminatory,
in order to protect both the interests of
Italian operators in the sector, which have already been seriously damaged, and the right of consumers
to be provided with accurate information, and also state the sanitary or public health grounds on the
basis of which the decision in question was taken?

(cid:129) Does the Commission not consider that it would be appropriate to take action, possibly by means of
new and further decisions which would officially sanction and safeguard the characteristic features of
the traditional products of each Member State of the European Union, with particular reference to
Italy in the case in question, instead of penalising such products?