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[Luxembourg 2005 Presidency of the Council of the European Union]
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Press Release
Economic and Financial Affairs Council in Luxembourg on 7 June 2005. The directive on taxation on savings will definitively enter into force on 1 July 2005

Date of release : 07-06-2005

Policy area : Economic and Financial Affairs Economic and Financial Affairs

Event : Economic and Financial Affairs Council

The Economic and Financial Affairs Council met in Luxembourg on 7 June 2005 for the last meeting under the Luxembourg Presidency. Beginning 1 July 2005, the United Kingdom will assume the rotating Presidency of the Council of the European Union.

Under the chairmanship of the Prime Minister and Minister for Finance, Jean-Claude Juncker, the Council also finalised the agreement on the directive on taxation on savings on which work had begun more than 20 years ago, and which was relaunched under the last Luxembourg Presidency in the second half of 1997. Confirming that the 25 Member States of the European Union, the five third countries and the 10 dependant and associated territories affected are prepared to apply identical measures as regards taxation on savings, the Council gave the go-ahead to the definitive implementation of the related directive starting on 1 July 2005. For Jean-Claude Juncker, this agreement is tinged "with extreme sadness", especially taking into account memories associated with 20 years of "clashes" within the Council. To conclude: "Moreover, as always, great advances have been made on taxation while Luxembourg has been holding the Presidency of the European Union. You will see if the Presidencies to come can make such an impression as Luxembourg."

The Presidency then tried to reach an agreement in the Council on prolonging reduced VAT rates. Jean-Claude Juncker: "I tried to lead the Council, by injecting a minimal dose of good sense, towards an agreement on VAT, and especially on reduced rates. Because good sense was drained when we were reaching an agreement on taxation on savings, it disappeared altogether when it came to reaching an agreement on the technical, but in fact primarily political, problems of reduced VAT rates. Nevertheless, we managed to get the Council to accept that the minimum VAT rate of 15% will not be changed but will be extended to 2010. Work on this matter will continue under the UK Presidency. It is understood that the reduced and super-reduced rates now in place in different countries, including Luxembourg, will still be applied.

Based on a document prepared by the Presidency and the UK delegation, the Council had an exchange of views on all the elements to be considered within the framework of Public Development Aid (PDA) in order to formulate a coordinated European position with a view to the Millennium Summit in New York in September. The intermediate objectives for the PDA have been confirmed, the possible ways of levying airline tickets are still to be clarified (mandatory deduction for Member States that want it, optional system for the others) and the precise conditions for multilateral debt reduction are still to be defined. Work will continue under the UK Presidency.

The Council approved an action plan on the quality of statistical data within the context of the Stability and Growth Pact, and more particularly, on the excessive deficit procedure. In this regard, the Council adopted a code of conduct on the independence of Eurostat and the National Statistical Institutes.

After listening to an introduction by Commissioner Joaquin Almunia on different elements of the package of measures to improve the statistical framework of budgetary figures, the Council had an exchange of views and adopted conclusions on the work to be continued.

The Council adopted three sets of conclusions on technical aspects of euro coinage: the authentication procedures for coins and the procedure for handling counterfeit coins in circulation; guidelines and a consultation system for the national sides; an agreement on a broadening of the map on the common side of coins to include all the Member States (including Romania and Bulgaria).

The Council adopted its report to the European Council of 16 and 17 June on the Broad Economic Policy Guidelines (BEPG), including the integration into the text of a great majority of the amendments proposed by the Presidency.

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This page was last modified on : 08-06-2005

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