Brussels, 26/01/2000 (Agence Europe) - "Despite the political undertaken by the Fifteen, the future of the tax package is uncertain", the European Commissioner for Tax, Frits Bolkestein told the European Parliament's Committee on Economic and Monetary Affairs on Tuesday (chaired by Christa Randzio-Plath, Germany, PES). The issue of the withholding tax continues to be the stumbling block in these negotiations, aimed at ending tax feebooting in the European Union. Talks will continue with the main recalcitrant country, Britain, said Commissioner Bolkestein, the problem being that of "convincing London that the Commission is not calling for the compulsory introduction of a withholding tax on savings but simple information concerning them".
In the field of company tax, the Commissioner hopes that work undertaken in Council, under the direction of Mrs. Dawn Primarolo, will continue at least until the end of her mandate in May. "The report that Mrs. Primarolo handed to the EcoFin Council in December still comprises many footnotes. We need to go further in the work to achieve a real consensus over preferential tax measures considered harmful and decide what to do about them", he explained. That, "even if nothing definitive can be achieved in one of the three chapters of the package (a) withholding tax, b) code of conduct for companies, c) interests and fees paid between associated countries), outside a comprehensive agreement", he added.
The absence of an agreement on savings in the course of this year would inevitably lead to the tax package as a whole being buried, the Commissioner acknowledged, and have very negative repercussions on the financial markets.
Finally, Mr. Bolkestein turned to the deadlock caused by Spain in the field of the tax on energy (which is not part of the tax package). He hoped for a positive development in the situation after the Spanish legislative elections in March.