Dick Spring
Ceist:85 Mr. Spring asked the Minister for Finance his views on the introduction of a harmonised withholding tax on deposit income in the EU; and if he will make a statement on the matter. [19507/98]
Written Answers. - Tax Code.
Like other member states we do not tax non-resident deposits. However, at the ECOFIN meeting in December 1997, member states agreed that a common EU framework to ensure a minimum of effective taxation of interest would be pursued. It was agreed that the Commission's proposal, based on the co-existence model, would form the basis for progressing the matter. The adoption of the co-existence model would give member states the option of either applying a withholding tax, levied at a proposed 20 per cent minimum rate by the paying agent, or of providing information on savings income to other member states, or using a combination of both systems. Ireland supports the general thrust of these proposals.
At this stage, however, the draft directive is under active consideration by a Council working group. While it is the intention of EU Finance Ministers to complete the process by the middle of next year, there are a number of significant issues which need to be resolved.