91999E0612

WRITTEN QUESTION E-0612/99

by Bernie Malone (PSE) to the Commission

(12 March 1999)

Subject: Double taxation agreements

Is it the Commission's policy to scrutinise double taxation agreements to ensure that there is no discrimination on the basis of nationality? Is the Commission aware of the provision in the Ireland-UK double taxation convention dealing with taxation of a foreign income dividend? Does the Commission consider this position to be discriminatory?

Answer given by Mr Monti on behalf of the Commission

(27 April 1999)

Member States are responsible for the negotiation and conclusion of bilateral double taxation agreements. Such agreements must respect Community law, in particular the basic freedoms and the non-discrimination principle. The Commission does not systematically scrutinise national tax legislation and double taxation agreements, but it examines their compatibility with Community law when a case is brought to its attention.

It is understood that both the United Kingdom and Ireland have recently amended their laws concerning the tax treatment of dividends. It is also understood that a protocol to the Convention between Ireland and the United Kingdom entered into force from 1 January 1999 for corporation tax purposes and will come into force on 6 April 1999 for income tax purposes and that this includes a new article dealing with the tax treatment of dividends.