Select Committee on European Communities Second Report


2.  CODE OF CONDUCT FOR BUSINESS TAXATION AND PROGRESS REPORT ON TAXATION OF INCOME FROM SAVINGS AND INTEREST AND ROYALTY PAYMENTS (COM (1998) 595)

Letter from Dawn Primarolo MP, Financial Secretary to the Treasury, to Lord Tordoff, Chairman of the Committee

  I enclose an explanatory memorandum on the above Commission Communication.

  This report will be considered as part of the ECOFIN 1 December discussion of progress on the Code of Conduct, savings tax, interest and royalties and state aid.

  The document has only just been published (25 November). If there were more time between publication of the document and ECOFIN, we would of course wish to have had the benefit of your Committee's consideration before the Council meeting. But I regret that on this occasion it will not be possible. We have not yet received the text under Council cover, so I am arranging for an advance copy to be deposited in Parliament today. I enclose a copy of the text for your ease of reference.

27 November 1998

Letter from Lord Tordoff, Chairman of the Committee, to Dawn Primarolo MP, Financial Secretary to the Treasury

  Thank you for your letter of 27 November enclosing an advance copy of this document, which Sub-Committee A considered at its meeting on 15 December. It decided to hold this document under scrutiny because it is relevant to the forthcoming enquiry on the co-ordination of tax policy, about which we shall be in touch with you separately. We do of course understand that you will need to participate in the on-going discussions on these subjects.

  Meanwhile, it would be helpful to have a copy of the interim report which we understand that your Code of Conduct Group made to the Council on 1 December, as well as any comments you may wish to give on that meeting.

15 December 1998

Letter from Dawn Primarolo MP, Paymaster General, HM Treasury, to Lord Tordoff, Chairman of the Committee

  Thank you for your letter of 15 December concerning the Commission's First Annual Report on the Code of Conduct for Business Taxation and Progress Report on taxation of income from savings and interest and royalty payments.

  You asked specifically to have a copy of the interim report which was presented to the Ecofin Council on 1 December. I should explain that because the Ecofin Council has agreed that the work of the Group is confidential I am not at liberty to make the report available to you nor to divulge details concerning other Member States. I have informed the House of Commons on 17 December 1998 of the UK measures which are on the initial list for discussion by the Group and I attach a copy of the Official Report for your reference.

15 February 1999

Letter from Lord Tordoff, Chairman of the Committee, to Dawn Primarolo MP, Paymaster General, HM Treasury

  Thank you for your letter of 15 February, replying to mine of 15 December, in which I asked for a copy of the Interim Report which your Code of Conduct Group had made to the Ecofin Council on 1 December. You say that you are not able to provide this because the work of the Group is confidential. Sub-Committee A has expressed great concern that this agreement among Member States' governments to carry on negotiations over a long period in secret denies national parliaments the possibility of scrutinising what is happening.

  While we quite understand that you personally are in a difficult position if ministers from other countries insist on their input remaining confidential, we trust that you will use you best endeavours to overcome this lack of transparency. It is clearly outside the spirit of the Amsterdam Treaty and makes a mockery of the professed intention of the European Council to bring Europe closer to the citizen. We will await with interest further developments and it is of course likely that Sub-Committee A will raise the matter when it takes evidence on its new enquiry.

9 March 1999

Letter from Lord Tordoff, Chairman of the Committee, to Dawn Primarolo MP, Paymaster General, HM Treasury

  You and I have been in correspondence about this document (most recently in my letter of 9 March to you, replying to yours of 15 February). As you will be aware, we are holding the document under scrutiny in connection with Sub-Committee A's current enquiry into taxes in the EU, and we are particularly concerned about the lack of transparency in the operation of the group.

  It is therefore unfortunate that your letter of 29 March to the Chairman of the European Scrutiny Committee in the House of Commons on this subject was apparently not copied to me. I would remind you that there is a long-standing convention that correspondence between Ministers and the Chairman of the scrutiny committee in one House should be copied to the Chairman and Clerk of the other, and I should be grateful if you could ensure that this convention is observed in the future.

4 May 1999


 
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