Brussels, 05/06/2001 (Agence Europe) - The Finance Ministers o the European Union, meeting on Tuesday under the chairmanship of Bosse Ringholm within the EcoFin Council devoted most of their meeting to preparing the European Council of Gothenburg.
They took note of a report from the European Commission and Presidency on the tax package. They examined the state of progress in the debate on tax and savings, and, in particular, the state of ongoing discussions with third countries and dependent territories. The Fifteen agreed to define a negotiating mandate in October with third countries on "equivalent measures" to the information exchange mechanism that the EU should put in place at the end of a seven-year transition period following entry into force of the directive on tax and savings, in compliance with the compromise reached at the European Council of Feira. A majority of Member states intend handing this mandate to the European Commission, whereas the United Kingdom, Luxembourg, Ireland and Austria would like the Presidency to join forces with the Commission. The central question concerns the definition of the concept of "equivalent measures". Luxembourg Prime Minister and Finance Minister, Jean-Claude Juncker said that the sense that the Commission currently gave equivalent measures was "too restrictive". Mr. Juncker recalled that Luxembourg's consent to the directive on tax and savings, which has to be adopted end-2002, was linked to the acceptance of equivalent measures by third countries (United States, Monaco, Switzerland, Andorra, Liechtenstein, and San-Marino) and measures concerning associated and dependent territories. According to a source close to the Council, no Member State, except Austria, wanted to debate Switzerland's current position, which is not prepared to drop banking secrecy. For many Finance Ministers the deadlock its not irrevocable. "Discussions with third countries have advanced well, we must now test out the reliability of our partners (…) Contacts with Switzerland are not so negative. We want work to continue and to be speeded-up", declared French Finance Minister Laurent Fabius. Denmark stipulated that Greenland and the Faros were ready to negotiate. The Chancellor of the Exchequer, Gordon Brown, made a report on the state of talks with the United Kingdom's associated and dependent territories, report that Jean-Claude Juncker qualified as "not that ambitious".
Creation of a working party on progress in the different elements of the tax package
Ministers also examined progress achieved in the framework of the code of conduct, which takes up the 66 harmful practices at tax level identified by the Primarolo Group. They insisted in this context on the need to ensure that, as far as the timetable is concerned, there is a parallel between the adoption of the code of conduct and the directive on savings tax. They decided to create a high level group which would be responsible for coordinating the parallel progression of the different elements of the tax package. The group will be composed of persons able to commit themselves on behalf of the finance ministers. Only the Spanish seemed sceptical, seeing this new group as a means to counter the work of the Primarolo Group.
Broad consensus was reached on the report concerning the Broad Economic Policy Guidelines (BEPG), to be addressed to the European Council of Gothenburg. Just two days from the British general elections, on 7 June, Chancellor of the Exchequer Gordon Brown said he was fully satisfied to see a reference by the European Commission to the budget of the United Kingdom 2002 disappear from the BEPG. The reference specified that public spending could not exceed 37.5% of GDP for the year 2002.