Published:

4 comments

KAMALL Syed open-neck

Syed Kamall is Chairman of the European Conservatives and Reformists Group and is an MEP for London.

It’s a slow motion car crash that everyone can see coming, but nobody seems able to stop. Greece has torn up the rulebook and won’t play Germany’s tune any longer. Most Germans I talk to say that’s Greece’s choice, but if they won’t play, don’t expect Germany to pay. With Spain’s communists also doing very well in polls for an upcoming election there, the real nightmare for other eurozone members has to be a big economy following Greece’s lead and refusing the austerity and structural reforms being asked of them by northern Europe.

Against that backdrop the possibility of Greece leaving the Euro has reared its head again. For what it’s worth, I think the Troika of the European Union (EU), European Central Bank (ECB), and International Monetary Fund (IMF) will come up with yet another fudge that will allow the Hard Left new Greek Prime Minister Alexis Tsipras to say he’s secured some loosening of the reins, but certainly the first few days of his government’s office suggest he’s itching for a fight.

Germany’s worries over the Greek election were only compounded by the European Central Bank’s decision to start printing money. Quantitative easing might have been seen as part of the solution in the UK but the eurozone’s problems are very different. Already the ECB has pumped cheap credit into the banks twice and the impact on the real economy has been fairly small. QE risks stimulating bubbles in the market and encouraging countries to put off difficult decisions all the time their economy is getting high on the sugar rush. As my ECR Flemish NVA colleague, the excellent Sander Loones, put it: “The Eurozone cannot duck the tough decisions, and this is just another exercise in kicking the can down an already long and troubled road.”

The other hot topic in Brussels is the EU’s response to the Charlie Hebdo attacks and the ongoing threat of radicalised fighters returning from Iraq and Syria. The main proposal being worked upon is the collection of Passenger Name Records – the data that you give an airline when you book a flight. My Conservative colleague Timothy Kirkhope is the parliament’s ‘rapporteur’ on the proposals and for the past three years he has been trying to put in place a system that will allow the data to be collected (it’s already being collected in some countries), but with clear rules on matters like how long it can be stored and when it must be anonymised. The data collected is used to detect patterns of suspicious behaviour that people with the right training have used to convict terrorists, people traffickers and drug smugglers. The parliament’s civil liberties committee rejected the plans in 2013 but Timothy has been working flat out since last summer to find a workable compromise.

One issue I’ve been working on is a law enacted at the start of the year that was originally intended to target companies like Amazon from avoiding VAT by making them charge it at the rate where the buyer is based. Unfortunately the proposal was agreed before the advent of smaller online businesses who have become caught in the crossfire and must pay VAT across every country where they sell. If you’re a very small business selling e-books or online knitting patterns the administration of complying with 27 other tax regimes is prohibitive. Some businesses have stopped selling to customers in other EU countries but are now being told they might be breaking EU anti-discrimination law!  The solution was supposed to be a VAT Mini One Stop Shop (VATMOSS) in every member state, but micro-businesses now have to register for VAT since there is no minimum threshold turning this so-called solution into a VATMESS.

My Conservative colleague Vicky Ford and I have been working with digital entrepreneurs to find a solution that will enable the smallest businesses to have the red tape lifted. I’m bringing a group of entrepreneurs affected by it to meet the European Commission so if you know anyone affected please tell them to get in touch. It should never have come to this in the first place but we will keep working with the digital micro businesses until we reach a satisfactory result.

I raised this VATMESS issue in a debate last week about the proposed EU investment fund which the Commission claims will raise 315 billion euros of funding by leveraging 21 billion euros of taxpayers’ money. I have my doubts about the fund but pointed out in my speech that there is no point in launching a new investment fund unless we cut the current barriers to private investors and get rid of stupid rules that are putting digital entrepreneurs out of business.

I hope to be able to report back on more of the business of our Strasbourg sessions in the future but for now we have very little legislation making it to the floor of the parliament. Partly this is due to being at the start of the new parliamentary mandate. The good news is that the new European Commission has decided that it wants to bring forward fewer new laws and instead focus on which proposals for legislation it can withdraw, or existing laws that it can scrap. Whilst this is a welcome development from the European Commission it also leaves the European Parliament seeking a slightly different role and I hope that we can instead spend more time scrutinising the Commission and supporting the rolling back of legislation while spending less time churning out new laws.

4 comments for: Syed Kamall MEP: In Brussels the Greek mess, the money mess and the VATMESS occupy minds

Leave a Reply

You must be logged in to post a comment.