CELEX: 51984PC0648
Language: en
Date: 1984-11-22
Title: PROPOSAL FOR A NINETEENTH COUNCIL DIRECTIVE ON THE HARMONIZATION OF THE LAWS OF THE MEMBER STATES RELATING TO TURNOVER TAXES, AMENDING DIRECTIVE 77/388/EEC - COMMON SYSTEM OF VALUE ADDED TAX

29.12. 84                            Official Journal of the European Corhmunities                         N o C 347/5
             Proposal for a 19th Council Directive on the harmonization of the laws of the Member
             States relating to turnover taxes, amending Directive 77/388/EEC — common system of
                                                     value added tax
                                                  (COM(84) 648 final)
                           (Submitted by the Commission to the Council on 5 December 1984)
                                                     (84/C 347/05)
THE COUNCIL OF THE EUROPEAN                                     Whereas the exercise of the right of option provided
COMMUNITIES,                                                    by Article 13C of Directive 77/388/EEC may involve
                                                                difficulties if it is applied to services rendered by
Having regard to the Treaty establishing the                    financial institutions in issuing or managing payment
European Economic Community, and in particular                  cards or other similar documents; whereas these
Articles 99 and 100 thereof,                                    services should therefore be excluded from the right
                                                                of option;
Having regard to the proposal from the Commission,
                                                                Whereas the absence of an exemption on importation
                                                                for official publications and for printed matter
Having regard to the opinion of the European
                                                                distributed by political organizations recognized as
Parliament,
                                                                such on the occasion of certain European or national
                                                                elections, and for postage stamps valid for use for
Having regard to the opinion of the Economic and                postal services within the territory of one of the
Social Committee,                                               Member States, leads to disparities in tax treatment;
                                                                whereas such exemptions should consequently be
                                                                provided for;
Whereas     certain differences       of    interpretation
concerning the principles of territoriality relating to
certain air and sea transport services should be                Whereas the exemption provided by Article 15 of
resolved;                                                       Directive 77/388/EEC should be extended to vessels
                                                                and aircraft intended for breaking up;
Whereas the terms 'fixed establishment' and 'forms of
transport' used in Article 9 of Council Directive
                                                                Whereas Article 17 (4) of Directive 77/388/EEC
77/388/EEC (x) should be clarified;
                                                                should be amended to take account of Council
                                                                Directive 79/1072/EEC ( 2 );
Whereas the option of adopting as the taxable
amount at importation the value defined by the
customs rules is no longer compatible with the degree           Whereas the rules relating to the calculation of the
of integration achieved by the Community and with               deductible proportion laid down in Article 19 of
the objective of strengthening the internal market;             Directive 77/388/EEC should be adapted to the
                                                                special nature of certain banking and financial
                                                                transactions;
Whereas it is necessary to define precisely the content
of the exemptions relating to hospital and medical
care, certain services closely linked to sport or               Whereas all these measures contribute to an increased
physical education and certain cultural services with a          degree of uniformity in the assessment basis for
view to ensuring their uniform application in the                collection of own resources provided for by Council
Member States;                                                   Decision 70/243/ECSC, EEC, Euratom ( 3 );
Whereas an exemption for the creative work of artists
is an appropriate means of encouraging the                       Whereas the period laid down in Article 34 of
development of cultural activities and the distribution          Directive 77/388/EEC for presentation of the report
of culture without causing distortion of competition,            on the application of the common system of value
provided that it is limited to artists who create                added tax should be adjusted,
original works;
                                                                 (2) OJ No L 331, 27. 12. 1979, p. 11.
(») OJ N o L 145, 13. 6. 1977, p. 1.                             O OJ No L 94, 28. 4. 1970, p. 19.
 ---pagebreak--- No C 347/6                             Official Journal of the European Communities                               29.12. 84
HAS ADOPTED THIS DIRECTIVE:                                           (c) Point (n) is replaced by the following:
                                                                          '(n) the following services and goods closely
                           Article 1                                            linked thereto supplied by bodies
                                                                                governed by public law or by other
Directive 77/388/EEC is hereby amended as follows:
                                                                                cultural bodies recognized by the
                                                                                Member State concerned:
 1. Article 9 is amended as follows:
                                                                                — services rendered to the public by
                                                                                     libraries, records offices and docu-
    (a) The following is added to paragraph 2 (b):
                                                                                     mentation centres,
         'a journey by sea or air shall be deemed to                            — entry to museums, galleries, picture
         take place entirely within a country when the                               galleries, monuments, historic sites,
         place of departure and the place of arrival are                             botanical gardens and zoos,
         in that country, provided there is no stop in
         another country;'
                                                                                — theatrical, musical, choreographic
                                                                                     and cinematograph performances,
    (b) The following paragraph 4 is added:                                     — the organization of exhibitions and
                                                                                     lectures.'
         '4. (a) The expression "fixed establishment"
                   in this Article means any fixed instal-            (d) The following points (r) and (s) are added:
                   lation of a taxable person, even if no
                   taxable transaction can be carried out                 '(r) the supply of works of art by the artist
                   there;                                                       who created them, where they fall into
                                                                                the following categories:
              (b) The expression "forms of transport"
                   in this Article includes pallets and                         — paintings, drawings and pastels
                   containers,     and   equipment      and                          including copies, executed entirely by
                   apparatus capable of being drawn or                               hand,      excluding   hand-decorated
                   pushed in order to perform a contract                             manufactured wares and industrial
                   for transport or towing.'                                         drawings,
                                                                                — lithographs, prints and engravings,
 2. Article 11B (2) is replaced by the following:                                    signed and numbered by the artist,
                                                                                     obtained from lithographic stones,
                                                                                     plates or other engraved surfaces,
    '2.     For the purposes of establishing the taxable
                                                                                     executed entirely by hand,
    amount the Member States may, in the case of
    goods which are not in one of the situations
    referred to in Articles 9 and 10 of the Treaty,                             — original sculptures and statuary,
    adopt the customs value determined                    in                         excluding mass-producered repro-
    accordance with the Community rules in force.'                                   ductions and handicrafts of a
                                                                                     commercial nature,
 3. Article 13A (1) is amended as follows:                                      — tapestries made by hand              from
                                                                                      original designs provided by artists,
                                                                                      provided that there is not more than
     (a) Point (b) is replaced by the following:
                                                                                      one example of each,
          '(b) hospital and medical care and closely                             — original ceramics and mosaics          on
                related activities undertaken by hospitals,                           wood.
                centres for medical treatment             or
                diagnosis and other duly recognized
                establishments of a similar nature;'                        (s) The supply of services consisting of the
                                                                                 public performance of their art by actors,
                                                                                 musicians, dancers and other performing
     (b) In point (m), 'certain services' is replaced by                         artists and the supply of services by
          'services';                                                            authors, composers and writers.'
 ---pagebreak--- 29.12.84                                Official Journal of the European Communities                                N o C 347/7
 4. The following is added to the second paragraph                       In relation to taxable persons who are not
    of Article 13c:                                                      established within the Community (Member
    'The right of option allowed for transactions                        States may refuse the refund or impose supple-
    covered in B (d) may not be granted in respect of                    mentary conditions) (1).
    services rendered by financial institutions in
    issuing or managing payment cards or other                           (*) OJ No L 331, 27. 12. 1979, p. 11.'
    similar documents.'
                                                                     8. The following is added to the second indent of
                                                                        Article 19(1):
 5. The following points (k) and (1) are added to
    Article 14 (1):                                                     'The amount to be included in the denominator
                                                                        shall be reduced by the purchase price of
    '(k) importations of official publications issued
                                                                        transfers of currency and securities exempted
          under the authority of States, international
                                                                        pursuant to Article 13B (d) (4) and (5); this
           institutions, regional or local authorities and
                                                                        amount shall include, where                 appropriate,
          bodies under public law, and printed matter
                                                                        commission and expenses incurred by the
          distributed      by    political     organizations
                                                                        purchaser. Where the taxable person cannot
          officially recognized as such in the Member
                                                                        determine the purchase price he may substitute
           States either on the occasion of elections to
                                                                        therefor the purchase price of currency or
          the European Parliament or on the occasion
                                                                        securities acquired during the same period,
          of national elections in the country in which
                                                                        provided those currencies or securities are
          the printed matter originates;
                                                                        identical with those sold.'
     (1) importations of mint postage stamps valid
          for use for postal services in one of the                 9. Article 34 is replaced by the following:
           Member States and sent by the postal
                                                                         'Article 34
           authorities of a Member State.'
                                                                        Every five years the Commission shall, after
                                                                        consulting the Member States, send the Council
                                                                        and the European Parliament a report on the
 6. Article 15 is amended as follows:
                                                                        application of the common system of value added
    (a) The following is added to point 5:                              tax in the Member States.'
         'this exemption extends to sea-going vessels
         intended for breaking-up;'                                10. Annex F is amended as follows:
    (b) The following is added to point 6:                              (a) Point 2 is replaced by the following:
         'this exemption extends to aircraft intended                        '2.     Services supplied by lawyers and
         for breaking-up;'                                                   members of other professions, except the
                                                                             medical and paramedical professions, in so
                                                                             far as these are not services specified in
                                                                             Annex B to the Second Council Directive of
 7. Article 17 (4) is replaced by the following:                              11 April 1967;'
    '4.     Refunds to taxable persons established in
                                                                        (b) Point 10 is deleted.
    another Member State who do not carry out any
    taxable transaction within the country shall be
    made in the circumstances and in accordance                                               Article 2
    with the conditions laid down in Council                       The Member States shall bring into effect the
    Directive 79/1072/EEC (*).                                     provisions necessary to comply with this Directive by
    Refunds to taxable persons established in another              1 January 1987 at the latest.
    Member State who carry out taxable transactions
    within the country, for which the person                                                  Article 3
    designated by the Member State as the person
    liable in application of Article 21 (1) (a) can only           This Directive is addressed to the Member States.
    be a person other than the taxable person, shall
    be made according to a procedure similar to that               (') Wording reproduced from the old paragraph 4, to be
    described in the abovementioned Directive.                          maintained until the 13th Directive is adopted.