By request of the Czech Finance Minister, Ivan Pilny, a meeting was held on the sidelines of the 'Economy/Finance' Council of Tuesday 11 July between him and his French counterpart, Bruno Le Maire, to try to move their positions closer together on two VAT dossiers: reduced rates on electronic books and the derogation requested by Prague to apply a generalised and temporary reverse-charge VAT mechanism.
The French Minister did not, according to our sources, change his stance. He reiterated that he believes the reverse-charge proposal runs counter to the Treaty on the Functioning of the EU, even with the amendments brought in by the Maltese Presidency of the Council of the EU on advice from the legal services. Le Maire is reported not to have specified the legal issue he considers to persist in the proposal.
He is also reported to have told his Czech colleague that he was disappointed that the latter had taken reduced VAT rate on electronic books hostage. “There is no legal link between the two texts”, a source told us.
Finally, Le Maire said that he was prepared to seek a solution that is not in conflict with the future definitive VAT regime awaited by the end of the summer. Pilny is reported to have replied by saying that he did not believe in this future regime. Both sides agreed to meet again at a more technical level at the end of July.
In June, the attempt to reach an agreement on the two texts broke down. According to our information, the French side cancelled the meeting scheduled to be held on the morning of the Ecofin meeting of 16 June, which had been arranged with a view to reconciling their positions, at the last minute. (Original version in French by Élodie Lamer)