Sant backs case against enforcement of minimum VAT rate

Labour MEP Alfred Sant said that EU member states who enjoy the right not to impose VAT on food and health products should not be forced to adopt a comprehensive minimum rate of VAT on all products. The final decision on VAT exemptions should be the prerogative of national government, he said, reacting to the report “Minimum standard rate of VAT” at the European Parliament in Strasbourg.

Sant said the case against the adoption of a comprehensive minimum rate of VAT across the board in the EU remains valid and extremely strong.

“This is another opportunity to assert that current exemptions on VAT rates allowed to national economies for items such as food or health products should not be removed, unless it is with the express and free assent of the national government involved,” he said.

Sant said VAT is a tax that proportionately burdens lower income earners more than it does higher income ones.

“Exemptions from it, especially those granted for social reasons, should be safeguarded. The effects of the 2008 recession, still with us, have been different across member states. Only in one area has the negative impact been similar everywhere: lower income citizens and families have been the most affected. Worse, while this happened, the strong and the wealthy were finding very good ways to avoid and evade other non-consumption taxes that they were subject to. No matter what the original reason was for opt-outs from uniform VAT levels across members states, their removal now should be considered exclusively on their own merits, seen from a social perspective,” remarked Sant.