04 June 2002

ECOFIN: No breakthrough on Tax issues

On the Directive on Savings Taxation Switzerland is continuing to demand the adoption of negotiating mandates on other sectors before committing to discussions on fiscal questions with the EU.

While the negotiations with most third countries are ongoing, the Union has not yet formally opened negotiations with Switzerland, pending the opening of negotiations on a number of unrelated subjects, such as participation in the Schengen/Dublin acquis, liberalisation of trade in services and participation in the Media plus audio-visual programme. Commissioner Bolkestein hopes Ministers will adopt these mandates at their June 17 session, thereby permitting negotiations on the taxation of savings to begin the following day.

Bolkestein acknowledged that negotiations with Switzerland are likely to prove difficult. Several other third countries (notably Liechtenstein and Monaco) have linked their positions on the taxation of savings revenue to the outcome of negotiations with Switzerland. A breakthrough with Bern would therefore permit progress on other fronts too.

Regarding the United States, the Commissioner explained that the US Treasury has already drafted a regulation which should permit the exchange of information with the EU. However, this project is still subject to reservations within the administration.

United Kingdom and the Netherlands have confirmed that they will apply the information exchange system proposed at the Union level as a general standard.

Furthermore, the Council adopted Conclusions on enhancing co-operation between national tax authorities. Ministers called on the working party on fiscal issues to pursue its efforts in search of an agreement on the Fiscalis programme, which aims to protect Community and national financial interests against fraud, with a view to permitting its adoption by the end of the year.

Results on ECOFIN meeting

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