When it comes to publishing ill-informed nonsense about the European Union, the Sun and the Daily Mail have always been tough to beat. But the Daily Express is giving them a good run for their money.
When it comes to publishing ill-informed nonsense about the European Union, the Sun and the Daily Mail have always been tough to beat. But the Daily Express is giving them a good run for their money. Today readers of the Express, owned by pornography baron Richard Desmond, no doubt choked on their cornflakes when they were informed that there is “new EU plot to tax our food” and that proposals for a new “green” fuel tax would lead to a new 8 per cent duty on diesel fuel. As with so many ‘stories’ in the Express, both are total rubbish.
The Express’s reporter, Macer Hall, wouldn’t have had to do much research to learn that EU legislation on VAT has existed since 1967 with the VAT directive establishing minimum levels coming into force in 1977. The VAT directive has a minimum rate of 15% while all countries can then decide whether they want to increase VAT to a level up to 20%. This was agreed by ministers from all EU countries including the Callaghan government.
The claim that the Commission has the power to “tax our food” is just untrue. As for the idea that a secret ‘EU plot’ is afoot to do this, well the Commission has published a Green Paper (pdf) on the future of VAT policy largely because some countries and businesses have found ways to dodge it. There has been no proposed legislation.
Besides, even if the Commission did propose to apply VAT to food, all Member States have a veto on taxation policy. Unless the Daily Express has unilaterally decided that VAT is not a tax (which would be news to most of us), food, baby’s nappies and other basic essentials could only be subject to VAT if the British (and all 26 other governments) agreed to it.
But as a principle, what is wrong with wanting to improve the effectiveness of a tax policy. As Richard Baron, head of taxation at the far from pro-EU Institute of Directors is quoted by the Express as saying:
“It is sensible for the Commission to take a long, hard look at the way VAT operates. It is a massive burden on businesses, and prone to fraud, so improvements are always welcome.”
On the question of a proposed 8% hike in diesel costs, Hall might at least have bothered to read the Commission proposal. Then he would have seen that the “proposal as such does not aim at raising additional revenue” but instead to rebalance the cost of different energy sources and products.
In fact, across the EU, the share of environmental and of energy tax revenues as a percentage of total tax revenues has actually reduced by 1% since 1995. Over the same time, carbon emissions have increased.
Under the proposal to revise the Energy Tax Directive, diesel fuel would gradually face higher minimum levels of taxation per litre compared to petrol. That’s because diesel has higher energy content and generates more CO2 emissions per litre than petrol. It might upset the Express but even the coalition government is committed to reducing carbon emissions.
In any case, how much the new ETD changes things will largely depend on pre-existing national rates and on how Member States want to apply the different tax rates. Considering that the proposal is revenue neutral it would seem logical that if the cost of one energy source goes up others will go down. Even then, the Commission proposal is just that – a proposal. If the Parliament and government ministers don’t like it, then it will be amended.
Still, if Macer Hall’s superb distortions weren’t good enough, the Express editorial is laugh-out-loud funny. Using the most purple of prose, it thunders that:
“Countries on the European mainland may lack the will to resist the EU political elite but the British people will not give up their island kingdom without a fight!”
Is anyone asking us to give up our ‘island kingdom’ (apart from those who want to abolish the monarchy)? Thought not. In the meantime we can all wait for a wonderful headline to appear: “secret EU plot to abolish Daily Express”……
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