WRITTEN QUESTION P-2300/03 by Helena Torres Marques (PSE) to the Commission. VAT deduction.
Date: 2003-07-07
Institutions: European Parliament, Provisional data
Subjects: EU law - national law, Portugal, VAT, approximation of laws, motor car, national implementing measure, purchase, tax exemption

C 51 E/236

Official Journal of the European Union

EN

26.2.2004

(2004/C 51 E/256)

WRITTEN QUESTION E-2294/03

by José Ribeiro e Castro (UEN) to the Commission

Subject: European charter for children in hospital

(11 July 2003)

The questioner tabled a question (E-1464/03 (1)) on the same subject in April this year and Commissioner
Byrne’s answer of 11 June has already been published.

However, the answer does not comment on the fact that a European Parliament resolution (2), adopted as
long ago as 1986, called on the Commission to submit ‘a proposal for a European charter on the rights of
patients and for a European charter on the rights of children in hospital’.

The Commission’s answer also completely ignores the fact that this request by Parliament has not been
met (cid:1) or even received an answer (cid:1) in 17 years!

Can the Commission therefore say whether the answer given by Mr Byrne to the previous question on the
same subject (E-1464/03) means that it is deliberately ignoring and does not intend to comply with the
request adopted by the plenary of Parliament?

(1) OJ C 280 E, 21.11.2003, p. 152.
(2) OJ C 148, 16.6.1986, p. 37.

Answer given by Mr Byrne on behalf of the Commission

(22 August 2003)

In its answer to the Honourable Member’s Written Question E-1464/03 the Commission already explained
that the Community does not have the competence to come forward with proposals for a European
charter on the rights of patients and for a European charter on the rights of children in hospital.

The adoption of a Resolution by the Parliament does not alter the compentences of the Union. On the
basis of the text of the present Treaty, the treatment of children in hospital and their rights as patients is
the sole responsibility of the Member States. The Commission is, therefore, not in a position to take action
in this domain.

(2004/C 51 E/257)

WRITTEN QUESTION P-2300/03

by Helena Torres Marques (PSE) to the Commission

(7 July 2003)

Subject: VAT deduction

Under European VAT law, anyone offering business or professional services or carrying out a commercial,
industrial or agricultural activity is entitled to a full or partial VAT deduction when purchasing a car which
is to be used in the context of that activity to generate profits for it.

In Portugal, however, the legislation transposing the Sixth Council Directive (cid:1) the VAT code (cid:1) does not
allow any deduction from the VAT paid upon purchase of a vehicle for the purposes of commercial,
industrial or agricultural activities.

Does the Commission consider that the Sixth Directive has been correctly transposed into Portuguese law?

If not, does the Commission consider it necessary to bring an action against the Portuguese State before
the Court of Justice of the European Communities?

26.2.2004

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Official Journal of the European Union

C 51 E/237

Answer given by Mr Bolkestein on behalf of the Commission

(31 July 2003)

The current Community rules on the deduction of VAT (Article 17(6) of the Sixth Directive (1)) permit the
Member States to retain all the exclusions provided for under their national laws when the Directive came
into force until new rules on expenditure not eligible for a deduction enter into force.

In Case C-43/96 (2) the Court of Justice ruled that Article 17(6) authorises the retention of national VAT
rules excluding from the right to deduct tax on vehicles constituting tools essential to the taxable person’s
business, since:

it is apparent from the wording of Article 17(6) of the Sixth Directive that, while it is for the Council
to decide what expenditure is not eligible for a deduction of value added tax, the rules which the
Council
is called upon to adopt are not automatically limited to expenditure that is not strictly
business expenditure. In those circumstances, the expression ‘all the exclusions’, used in the second
subparagraph of Article 17(6) of the directive, comprises expenditure which is strictly business
expenditure.

The Court of Justice pursued this line of reasoning in Case C-305/97 (3). It ruled that Article 17(6) of the
Sixth Directive authorises the Member States:

… to retain general exclusions from the right to deduct the VAT payable on the purchase of motor
cars used by a taxable person for the purposes of his taxable transactions, even where those cars were
tools essential to the person’s business or where they could not, in specific cases, be used for private
purposes by that person.

The Commission considers the exclusions and restrictions that the Member States currently apply to the
right to deduct by virtue of Article 17(6) of the Sixth Directive to be highly disparate, which can lead to
distortions of competition. Though these disparities are nothing new, their adverse effects have become
more visible since the creation of the internal market. The Commission feels that the directive it has
proposed on the rules governing the right to deduct value added tax (4) would address the above problems
effectively.

The proposed directive provides for the deletion of Article 17(6)
It also
introduces an optional arrangement for the deduction of VAT on passenger cars enabling Member States
which so wish to determine the part of the non-business use of passenger cars in a simplified manner.
Member States not wishing to apply this simplified procedure would, however, have to apply the normal
deduction rules in this matter.

from the Sixth Directive.

Under Article 93 of the EC Treaty, the adoption of this proposal calls for unanimous agreement in the
Council. At the moment the proposal is still under discussion and no agreement has been reached on its
adoption.

(1) Sixth Council Directive of 17 May 1977 on the harmonisation of the laws of the Member States relating to

turnover taxes (cid:1) Common system of value added tax: uniform basis of assessment, OJ L 145, 13.6.1977.

(2) Commission of the European Communities v French Republic [1998] ECR I-3903.
(3) Royscot Leasing Ltd, Royscot

Industrial Leasing Ltd, Allied Domecq plc and T.C. Harrison Group Ltd v

Commissioners of Customs & Excise [1999] ECR I-6671.

(4) OJ C 219, 15.7.1998.

(2004/C 51 E/258)

WRITTEN QUESTION E-2313/03

by Roger Helmer (PPE-DE) to the Commission

(14 July 2003)

Subject: Ramifications of the Chemicals Directive

Is the Commission aware of the concerns of the leather industry in Europe regarding the Chemicals
Directive? The industry fears that the directive will lead to substantially increased costs for processing