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Dáil Éireann debate -
Tuesday, 30 Sep 1997

Vol. 480 No. 6

Written Answers - Duty-Free Sales.

Noel Ahern

Question:

228 Mr. N. Ahern asked the Minister for Finance the action, if any, his Department is taking to retain duty-free sales to passengers travelling within the EU; if his attention has been drawn to the importance of this to many Irish employees, particularly at Dublin Airport; and the plan of action, if any, he has to win concessions from Brussels; and if he will make a statement on the matter. [14979/97]

I have received representations from people who are likely to be affected by the ending of duty free sales for intra-EU travel, including people working at Dublin Airport. I am very much aware of their concerns on this issue.

The initial proposals by the European Commission would have ended duty free sales in December 1992. The extension of the concession to 1999 was agreed in response to pressure from Ireland, among others, to allow time for the industry to adapt. Duty free or tax-free sales for travellers to non-EU destinations are not affected.

As has been explained in this House before, the decision to end duty free facilities for intra-community travel can only be reversed by unanimous agreement at Council, following a proposal from the Commission. So far the Commission, which has always held the view that the principle of tax-free trading on intra-Community journeys is incompatible with the concept of an internal market without internal frontiers, have maintained that they are not prepared to put any fresh proposals to the Council for any extension beyond 30 June 1999, and have confirmed this position as recently as last week.

My predecessor raised the matter at the November 1996 ECOFIN while Ireland was in the Presidency, but Ireland was not able to convince the Commission to carry out a study of the economic impact of ending duty free sales.

In order to inform any future discussions on this issue my Department has now engaged consultants to conduct an independent study into the direct consequences for Ireland of the ending of duty free sales for intra-EU travel.
After examination of the results of this study - which should be completed by the end of the year - I will be able to consider what further action, if any, can be taken in addition to lobbying the Commission.
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