WRITTEN QUESTION No. 3187/97 by Jacques DONNAY to the Commission. Amendment of the Sixth Directive on the application of the reduced rate of VAT in the housing sector
C 134/106 EN Official Journal of the European Communities 30. 4. 98 (98/C 134/136) WRITTEN QUESTION E-3176/97 by Armelle Guinebertie‘re (UPE) to the Commission (13 October 1997) Subject: Application of reduced VAT rate in the housing sector Business in the building sector is currently picking up. In the housing sector, maintenance and refurbishment account for one third of building companiesí turnover. However, pursuant to the Sixth Directive of 17 May 1977, Community law restricts the application of the reduced VAT rate to supply, construction, renovation and alteration of housing provided as part of a social policy (Article 12(3)(a) and Annex H, category 9 of the Sixth Directive 77/388/EEC) (1). Could the Union, and more specifically the Commission, require Member States to extend the reduced VAT rate? (1) OJ L 145, 13. 6. 1977, p. 1. (98/C 134/137) WRITTEN QUESTION E-3187/97 by Jacques Donnay (UPE) to the Commission (16 October 1997) Subject: Amendment of the Sixth Directive on the application of the reduced rate of VAT in the housing sector The Sixth Directive of 17 May 1977 (77/388/EEC (1)) limits application of the reduced rate of VAT in the housing sector to the supply, construction, renovation and alteration of housing provided as part of a social policy. This restrictive European framework has prompted successive national governments to refuse to extend the reduced rate to building work other than that connected with social housing. In the housing sector, however, maintenance and rehabilitation work now represents one third of the turnover of construction firms, in other words some FF 145 billion net of tax. Amending the Sixth Directive to extend the scope of the reduced rate of VAT for the housing sector would undoubtedly have an effect on limiting recourse to clandestine labour and help to satisfy housing quality requirements. What does the Commission intend to do to abolish this constraint on undertakings in this economic sector? (1) OJ L 145, 13. 6. 1977, p. 1. Joint answer to Written Questions E-3176/97 and E-3187/97 given by Mr Monti on behalf of the Commission (25 November 1997) The Commissionís recent report to the Parliament and to the Council (1) explains in detail its views on the use of reduced VAT rates as an instrument for boosting the building and construction sector and as an incentive for recuperating some of the activities in this sector from the black economy (report from the Commission to the Council and to the Parliament in accordance with Article 12(4) of the Sixth Council Directive of 17 May 1977 on the harmonisation of the laws of the Member States relating to turn-over taxes › common system of value added tax: uniform basis of assessment)