European Parliament to pass pensions tax bill

EUROPE – The European Parliament was today expected to pass with a clear majority the report on the elimination of tax obstacles to cross-border provision of occupational pensions by Dutch MEP Ieke van den Burg.

The report supports the proposals of the European Commission for improvement of the exchange of information between Member States, the proposal for pan-European pension funds and broader application of the EET (exempt, exempt, taxed) principle.

It also supports mutual recognition of occupational pension schemes, automatic exchange of information and the elimination of tax barriers for the transfer of accumulated pension schemes.

Van den Burg says she believes it is important that the European Parliament approves the report before this week’s Laeken Summit.

She comments: “The Belgium Presidency has also scheduled the launch of an open co-ordination process for the financial sustainability and social quality of pensions. Member States will commit themselves to make national strategy reports before September 2002, and at the Spring Summit of 2003 measures will be discussed. The process regarding taxation could be linked to it. Before that the European Commission needs to set a clear timetable for infringement procedures and needs to develop an action plan and score board to monitor the measures that already can be taken. Furthermore there needs to be a efficient and automatic exchange of information and assistance on recovery. We have to find a solution for barriers on the transferability of accumulated pension funds. In this light the idea of pan-European pension funds with tax facilities is very interesting.”

In a separate move, EC Internal Market Commissioner Frits Bolkestein will tomorrow present the Commission's fifth progress report to the Council on the Financial Services Action Plan.
Bolkestein will reiterate his disappointment at the absence of decisive progress in the Council on the proposed pension funds Directive.

The proposal was tabled by the Commission in October last year and is scheduled for adoption in the Action Plan by 2002.
The Action Plan, adopted in May 1999 by the European Commission, spells out the EU´s overall policy for achieving integrated financial markets.
The European Councils in Lisbon and Stockholm endorsed the Action Plan, setting 2005 as the deadline for the integration of the financial markets and 2003 as target date for integration of the securities markets.

See Full report on IPE-Newsline tomorrow.

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