'Standardise lorry tax' plan can be vetoed
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1. Forget 1984. That used to be the year of doom, thanks to George Orwell's novel and a horrific 1953 TV adaptation, but now a real 1992 replaces a fictitious 1984.
This month sees a major Government campaign, to be launched in the lush surroundings of Lancaster House, aimed at alerting the British public in general, and the business community in particular, to the reality of "the completion of the European internal market'.
This translates into a frontier-free European Economic Community, or EC as it is becoming fashionable to abbreviate it. It is supposed to be achieved by the end of 1992. For road transport that should be welcome. Frontier delays are costly, and a bigger market should mean a bigger demand for transport, but what will it mean in terms of legislation?
Before coming to specifics it is necessary to look at the legal basis of the internal market itself, and the 1992 target date. A certain amount of jargon is inescapable, but becoming familiar with it now will make the Government's campaign easier to comprehend.
The concept of the internal market is enshrined in the Single European Act, another piece of jargon. This is a solemn treaty between all 12 countries, signed in February 1986, and ratified by all 12 Parliaments, including Westminster. It defines the market as: . . . an area without internal frontiers in which the free movement of goods, persons services and capital is ensured in accordance with the provisions of the (EEC Treaty of Rome).
That, at least, is clear enough, but the timetable is legs firm. The Single European Act commits its signatories to "adopt measures with the aim of progressively establishing the internal market over a period expiring on 31 December 1992". A subsequent declaration expresses a "firm political will to take before 1 January 1993 the decisions necessary to complete the internal market". It then hedges this, however, by adding "Setting the date of 31 December 1992 does not create an automatic legal effect."
So the law requires that the internal market be completed, but not necessarily by the end of 1992. The European Commission estimates that this will require something like 300 new Regulations and Directives. They have under taken to put forward 90% of these before the end of this year. Over 200 have already been tabled; but only 67 have been adopted by Ministers. The other 130 are "on the table", in various stages of consideration. Some are merely held up on points of detail cabotage is a good example. Others face major objections of principle, of which the most important is probably the Dutch opposition to the "territoriality" principle of the lorry tax proposal.
A few of these 300 measures relate directly to transport abolition of international haulage quotas, for example. Some, in other policy areas, will have a direct impact, notably in the removal of fiscal barriers and better Customs and other frontier-crossing procedures.
At first glance the EC governments seem to have set themselves an impossibly tight timetable. In the first 25 years of the EC's existence only just over 50 transport Regulations and Directives were adopted. Even that snail's pace two instruments a year does not tell the whole story. For over half that period only six members had to reach agreement; the awkward squad Britain and Denmark were involved only for the last 10 years of that quarter century. • Naturally, the easy bits were dealt with first. Who could argue against the standardisation of permit forms, or the prohibition of discrimina tion in transport rates? The problems to be resolved, however, within the next 57 months are at the other end of the spectrum of difficulty and political sensitivity. None is more difficult and sensitive than taxation. This was recogni sed by the Single European Act, which specifically says that majority voting "shall not apply to fiscal provisions". In other words, each Government has a veto.
The existence of that veto has been queried by a recent case involving VAT in which the European Court ruled that the United Kingdom was wrong to zero-rate spectacles. This led to cries of outrage from those on both sides of the Commons opposed to Britain's EC membership, Typical comments were "For the fast time in 300 years an outside body has imposed a view on Parliament or the British government concerning the taxation of its people," and "A test case which clearly established the supremacy of the European Court over this sovereign Parliament."
These comments overlooked one fact. The Court was not overruling Parliament. It was interpreting a Directive adopted, with full UK agreement, in 1977. This lays down certain criteria for zero-rating, including medical grounds. The Court decided that spectacles, contact lenses and hearing aids fell outside these criteria. Other pending cases are expected to do the same for industrial construction, coal and sewerage. The merits of these decisions are certainly debatable, but the lesson they teach is that governments should look closely at EC legislation before they agree to its adoption.
For better or worse they do not indicate the inevitability of the Commission's plan that diesel should be taxed at a rate representing the EC average. For, unlike the zero-rating Directive, that is just a proposal. It can be vetoed So can the plan to standardise the structure of lorry taxes as a first stage before more radical measures.
The Government's "Prepare for 1992" campaign will undoubtedly stimulate a reaction from those who oppose our EC membership. The general unpopularity of the EC with the British public ensures that this will get at least as much publicity as the official campaign. That makes it all the more important that those who should be planning now for 1992 look behind the rhetoric of both sides to the facts. Otherwise they might find that the year of doom happens after all just eight years late, • by Keith Vincent