Pyrpolizer wrote:And here's another one:
Boy o boy this second report is a treasure. The mother of the Devils called RoC tried so much to help the TCs regarding the VAT issues that the EU committee herself turned them down as being illegal/too much away from the Aquis. The RoC itself wanted to violate the Aquis just to help the TCs, and all we hear in this forum is the crying and the screaming of Vepo against RoC and the devilish GCs....
VAT issues
The Republic of Cyprus renewed its request to the Commission to propose amendments to the
Green Line Regulation and/or the 6th VAT Directive in order to simplify certain VAT
provisions concerning the trade across the Green Line. The proposals included a request to
apply a reverse charge mechanism for supplies made by taxable persons established in the
areas13 to taxable persons in the government-controlled areas, a request to apply simplified
procedures for the collection of tax on goods supplied by taxable persons established in the
areas when these are supplied in the government-controlled areas to non-taxable persons, a
request to allow for supplies made to the areas to be treated as export transactions (amending
Article 5 of the Green Line Regulation) and the request to allow for simplified procedures
when goods are crossing the line with a view to be transferred to other Member States. The
Commission has seriously examined these proposals and communicated to the Republic of
Cyprus extensively why the majority of the proposals would have deviated too much from the
acquis to be taken up by the Commission, even though some of them may be attractive from
the point of view of simplification.
I find it a bit disingenuous that you forgot to include the example just underneath that paragraph:
One example can be given for illustration: The Republic of Cyprus requested that supplies
made to the areas be treated as export transactions (amending Article 5 of the Green Line
Regulation). This proposed measure is not consistent with the provisions and the philosophy
of the Green Line Regulation where it is assumed (upon request from the Republic of Cyprus)
that no importation takes place when goods arrive from the areas. Consequently, the reverse
transaction cannot be treated as exportation. In other words: zero-rating supplies made from
the Government-controlled areas to the areas could only be justified if these were to be treated
as exports. This is the case irrespective of whether these supplies are called exports. If goods
leaving for the areas are treated as exports, goods coming from the areas must equally be
treated as imports. Only under those circumstances would the proposed change be acceptable.
The VAT problem is a problem because of the way the GC's wanted the green line regulation to work and cannot be solved because of that simple fact. The only way the VAT problem can be solved is via the direct trade regulation (there's a copy on the net) thats why the GC's tried to get it fixed in the green line regulation, to kill the need for the direct trade one.