Letter: Duty-free axe

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The Independent Online
GEOFFREY MARTIN of the European Commission rightly points out (letter, 13 March) that EU finance ministers unanimously agreed in 1992 that duty- and tax-free sales within the EU should be abolished from 30 June 1999. But he omits to mention three things.

The decision was made against the background of an expectation of at least some degree of harmonisation of tax rates as part of the process of completing the single market. That has not happened; there remain massive differences in excise rates and abolition of duty-free before that issue is addressed is putting the cart before the horse.

The warnings of job losses, damage to the regions and higher travel costs come from a number of independent research studies. These were commissioned by the industry, but only because the Commission itself has consistently refused to undertake a study of the economic and social consequences of abolition, as formally requested by the European Parliament in 1991.

Since 1991 the Commission has likewise made no effort to propose an alternative workable regime to duty-free. Hence the chaotic situation if duty-free is abolished.

This whole issue must be reviewed by EU finance ministers.

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