TEI files comments with the European Commission on modernizing the VAT obligations of financial services and insurances.
Position | Tax Executives Institute, value added tax |
On June 9, 2006, Tax Executives Institute filed comments with the European Commission on a Consultation Paper on modernising the VAT obligations of financial services and insurances. The comments were prepared under the aegis of TEI's new European Tax Committee, whose chair is Guy A. Kersch of Pfizer, Inc. Contributing substantially to the development of TEI's comments were Keith A. Miller of SABMiller, Afke Van Mansum of Dupont Du Nemours International, and Karl-Heinz Haydl of General Electric Company.
On 11 May 2006, the Directorate-General Taxation and Customs Union of the European Commission released a Consultation Paper on modernising Value Added Tax obligations for financial services and insurances. The purpose of the consultation is to generate feedback on possible options for changing the provisions in the Sixth VAT Directive and to provide input for discussions with stakeholders. On behalf of Tax Executives Institute, I am pleased to submit the following comments.
TEI Background
TEI was founded in 1944 to serve the professional needs of business tax professionals. Today, the organization has 53 chapters in North America, Europe and Asia. As the pre-eminent international association of business tax professionals, TEI has a significant interest in promoting tax policy, as well as in the fair and efficient administration of the tax laws, at all levels of government. Our 6,000 members represent 2,800 of the largest companies in the United States, Canada, Europe, and Asia. In 1999, TEI chartered a chapter in Europe, which today encompasses employees of a wide cross-section of European and multinational companies. TEI members are accountants, lawyers, and other corporate and business employees responsible for the tax affairs of their employers in an executive, administrative, or managerial capacity. The Institute espouses organisational values and goals that include integrity, effectiveness and efficiency, and dedication to improving the tax system for the benefit of taxpayers and tax administrators alike.
General Comments
Since July 2000, the European Commission has been reviewing various proposals in the value added tax (VAT) area. The most recent Consultation Paper identifies various issues arising in the insurance and financial services businesses and discusses the advantages and disadvantages of alternatives for modernising the Value Added Tax provisions.
TEI commends the Commission for undertaking the consultation process. Although the primary focus of the paper is the insurance and financial services businesses, any changes in the Sixth VAT Directive will affect potentially every business that provides supplies to financial services companies, consumes financial services, or makes auxiliary supplies of financial services in connection with its principal business. In sum, every business, large or small, public or private, has a stake in the modernization of the Sixth VAT Directive.
The Consultation...
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