§ Mr. Day
To ask the Chancellor of the Exchequer if he will make a statement on the outcome of the latest meeting of the European Community's Economic and Finance Council, the meeting of the intergovernmental conference on economic and monetary union and the interinstitutional meeting with the European Parliament.
§ Mr. Norman Lamont
The Economic and Finance Council of the European Community met in Luxembourg on 10 June. I represented the United Kingdom. I also attended a meeting of the intergovernmental conference 627W on economic and monetary union. The Minister of State attended the inter-institutional meeting with the European Parliament in Strasbourg on 11 June.
Following the meeting on 3 June, the Council again discussed the presidency's proposals for the future of VAT and excise duties in the single market. No agreements were reached and discussions will continue. I reiterated that the United Kingdom remains unconvinced that there is a need for a centrally imposed minimum VAT rate in the single market. But I again made it clear that the United Kingdom has no intention of changing our VAT rate.
On excise duties, member states remain very wide apart. I argued that the minimum duty rates on alcohol and tobacco in the presidency proposals were too low. I reiterated that there would need to be much higher minimum rates or measures such as limits on the amounts of these goods that can be brought into any member state tax paid, if agreement were to be reached.
The Community's contribution towards loans by the G24 to Hungary, Bulgaria and Romania was also discussed. An informal agreement was reached that the first tranche of 100 mecu of an EC guaranteed loan to Hungary could now be released, since a matching sum had been committed by members of the G24 outside the EC, but it was agreed that the release of a first tranche of 150 mecu to Bulgaria should await a similar matching contribution. Discussion of a loan to Romania was deferred until the meeting of ECOFIN in July.
At the ministerial meeting of the intergovernmental conference on EMU, the presidency invited member states' views on key issues, which would inform preparations for the meeting of the European Council later in the month. I noted that a significant number of important issues required further debate in the IGC and suggested that the presidency might want to refer to these, while also registering the consensus achieved on issues such as the importance of convergence, in its report to the European Council.
Our negotiating position in the IGC remains unchanged. The United Kingdom cannot accept changes to the treaty of Rome that would bind us to move to a single currency or a single monetary policy without a separate decision by the United Kingdom Government and Parliament.
The inter-institutional meeting with the European Parliament enabled Members of the European Parliament to put their views on the EMU IGC to Finance Ministers. The meeting was purely consultative in nature.