Brussels, 07/07/2000 (Agence Europe) - The French Council Presidency, which inherited the cumbersome dossier on savings tax in June, plans to tackle the task from next week on. The group of Fifteen responsible for preparing Council deliberations in the taxation field will meet, on Tuesday 11 July, to plan the unfolding of work until the end of the year. It is expected that discussions will be on the heart of the matter at the end of the month.
The Fifteen will have a substantial technical task before them. During the European summit in Feira, on 19 and 20 June, the Heads of State and Government called on the Ecofin Council to continue to show determination in work relating to all the sections of the taxation package (code of conduct on corporate tax, directive on savings tax and directive on the taxation of interests and fees paid between partner companies). The French Presidency's priority is to "seek an agreement on the essential content of the directive" on taxation of savings income.
One French diplomat in Brussels states: "we shall be dealing with the matters which need clearing up". The draft directive aims to levy taxes on interests earned by European citizens on savings invested in an EU State other than their country of residence. The Fifteen should, for this, set in place an information exchange system between their tax administrations, except for Austria, Luxembourg, Belgium, Greece and Portugal which, during a transitional period, will be able to levy withholding on savings of non-residents. The French Presidency hopes to clarify the scope of the directive, and above all the definition of interests targeted, the role of the paying agent (usually a bank), and the arrangements for information exchange and withholding, including the level of taxation and the sharing of receipts made between Member States.
"We hope to continue the negotiations on the substance and, once we have cleared this up, start the negotiations with third countries, which we will only do if we reach something sufficiently precise," explained this diplomat. The rhythm of work, during this six months, will be relatively sustained, since the Council's "fiscal issues" group gathers twice per month and a more high level group (directors of central administration) will meet every month, as of September.