Brussels, 26/02/2004 (Agence Europe) - The European Parliament's Committee on Economic and Monetary Affairs suggests that the Parliament in plenary reject the Commission's proposal to impose VAT on public postal service companies. It is, however, the Council that has the last word in this taxation area.
In May 2003, the European Commission had proposed an amendment to the 6th VAT Directive for generalising application of VAT to all postal services. It thus hoped to place the private sector on an equal footing with the public sector, which had hitherto not had to impose VAT. According to its proposal, the Member States could, however, apply a reduced rate of VAT on ordinary postal services, both private and public.
During the plenary session of December 2003, MEPs had rejected the proposal, against the opinion of the rapporteur, Swedish Liberal Olle Schmidt, and had referred the report to committee, with 278 in favour, 253 against and 12 abstentions. Supporters of competition had then spoken out against those defending the public service (see EUROPE of 23 December, p.11). The Committee on Economic and Monetary Affairs confirmed this tendency this week, by a slim majority (16 for 12 against and 2 abstentions).