Meeting Summary
The Committee considered the following documents:
Ukraine and Russia: EU restrictive measures
The European Council has consistently said that it
will not recognise the Russian annexation of Crimea, a position
which the Government fully supports. Trade and investment bans
were introduced in June and July 2014, which prohibited both the
import of goods from Crimea and the investment in the development
of infrastructure in the areas of transport, telecommunications
or energy and export of listed key technologies for use in these
sectors. New measures have now been proposed which extend some
of the existing restrictions and place new prohibitions on acquiring
real estate or providing services directly related to tourism
in Crimea or Sevastopol. In his Explanatory Memorandum, the Minister
recalls the Government's view that the annexation of Crimea violates
the UN Charter and is illegal under international law. Although
these views are widely held, they are not universally supported;
nor indeed is the EU's approach to Ukraine and its relationship
with Russia. We therefore recommend these new measures for debate
on the floor of the House alongside the EU-Ukraine Association
Agreement. The debate on this Agreement, which we recommended
last October, has still not been scheduled, which we deplore.
Value added taxation
This week we consider a proposal to amend the 2006
Principal VAT Directive, which consolidated the legislation governing
valued added taxation in the EU, and lays down rules to ensure
a consistent approach to the questions about how much VAT to charge,
when it should be declared and to which jurisdiction the tax should
be paid. This proposal would amend the Directive in order to clarify
and harmonise the rules related to the VAT treatment of vouchers.
We considered this proposal in September 2012 and, in noting its
importance in relation to the efficacy of the EU's VAT system,
requested that the Government provide us with further information
in due course. The Government has now provided us with a helpful
update, but it remains unclear how further Council consideration
will pan out. As a revised text of the draft Directive may go
to the ECOFIN Council in the coming months, we recommend this
document for debate in European Committee. This debate will provide
members with the opportunity to explore the details of the proposed
solutions to what is a complex problem and the possible consequences
for UK businesses.
European Semester
The annual European Semester is an EU-level framework
for coordinating and assessing Member States' structural reforms
and fiscal/budgetary policy and for monitoring and addressing
macroeconomic imbalances. An element of the European Semester
is the Macroeconomic Imbalances Procedure, and as part of the
first stage of this procedure, the Commission publishes an annual
Alert Mechanism Report, which we consider this week. This Report
discusses macroeconomic factors affecting the EU as a whole, presents
short analyses of the macroeconomic situation of most Member States
and says that the Commission will be conducting In Depth Reviews
for 18 Member States, including the UK, during the first quarter
of 2015. We recommend this document for debate in European Committee
alongside three other documents, which we recommended for debate
last month and which form the other element for the first stage
of the European Semester: the Commission's Annual Growth Survey,
the draft Joint Employment Report, and the Autumn European Economic
Forecast.
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