Thursday 12 May 2011

The Tory EU dilemma...

It’s true that normally the words “interesting” and “European tax regulation” don’t go.

But last night there was a telling Commons exchange over EU Commission plans to set up a Common Consolidated Corporate Tax Base (CCCTB) – honestly, don’t stop reading, it gets better.

At the moment companies operating in different EU member states use different calculations to work out their taxable profit.

So the EU wants to set up a CCCTB which would see all member states complying with one EU-wide system - the advantage being that a company working across the EU would not have to carry out 27 different calculations to work out their taxable profit in each state.

The actual tax rate would still be up to the member state to set, but the way taxable profits were determined would be uniform.

Predictably the Tory right have stomach pains at the mere thought of it – as Amber Valley MP Nigel Mills put it “this whole thing has to be seen as a drive towards a single European Union, a single federal state”.

But the Government is having difficulties defining its position. It claims it doesn’t want anything that diminishes the UK’s power to determine its own tax policy.

It is a statement of position which has led Tory Eurosceptics to ask the Government why it doesn’t just veto the proposal and say no to the whole thing.

But ministers aren’t willing to do that, pointing out that the UK should be involved in negotiations on a plan other states might adopt, even if they don't, because it still might affect the UK indirectly.

Some might say the Government is taking this stance because they're purposefully trying to debunk the CCCTB, and the EU, from the inside – an argument put beautifully by Sir Humphrey Appleby in this video.

But I’d suggest it actually indicates the fundamental difficulty and contradiction in Government, particularly Conservative, EU policy.

They don’t want CCCTB to happen, but they can’t bear to be outside the negotiations just in case something happens without them that might affect them, that might tie them in even closer.

In other words they have to be in, because they want to be out.

Attempting to stir a Coalition split, Shadow Treasury Minister Chris Leslie suggested last night that it was the Lib Dems that was stopping the Tories from vetoing CCCTB outright.

But I suspect the bigger coalition partner would have the same problem were it in government alone.

Wednesday 11 May 2011

IPSA shake up?

It seems that both Labour and Tory leaders are having problems getting the troops in line to oppose Adam Afriyie MP’s backbench business motion tomorrow.

The motion calls for the Government to get on with an overhaul of IPSA – the body that administers the MPs expenses system. It reads:

That this House regrets the failure of the Independent Parliamentary Standards Authority to introduce a simpler, cheaper and less discriminatory scheme of office expenses and Members’ allowances in accordance with the resolution passed by this House on 2 December 2010; calls on the Government to fulfil its commitment by making time available for a Parliamentary Standards Amendment Bill to implement a scheme which fulfils the criteria of the resolution; and instructs the Leader of the House to make time available no later than 19 July 2011.

Its appearance marks MPs’ more strident aggravation at IPSA which they say leaves them thousands of pounds out of pocket before the grinding system reimburses them for everything from office costs to their second home allowance.

New MPs in particular feel aggrieved, having played no part in the expenses scandal throughout 2008/09.

David Cameron is getting whips to lean on his troops to vote against the motion but a number are apparently determined to back it.

Labour apparently also wants to whip the vote but doesn’t want to do so if its MPs are going to back the motion anyway.

Both Cameron and Miliband apparently fear that it will not look good to the electorate, feeding the “they just don’t get it” mindset, and they are probably right.

Tuesday 10 May 2011

Gov to back PNR database?

Later today the Government will make a statement on an EU directive relating to Passenger Name Records (PNRs).

PNR data-systems were established so that when a passenger made several changes between airlines to travel to a single destination, their details could be passed between the airlines with more ease.

The records show the passenger's name, address, DoB, passport details and how they paid for their ticket.

The EU's directive demands that member states require airlines to transmit this data to the relevant authorities in their country "for the purpose of preventing, detecting, investigating and prosecuting terrorist offences and serious crime."

In a statement today the Government may well back the directive, given that it has already been in talks with the EU Commission and other leading member states on how to bring about the change.

The concern is that this effectively creates an EU wide database holding sensitive details of millions of people - access to which is granted to the authorities in all member states.

I feel a certain churning when the UK Government appears to encroach on data privacy, let alone other states who are not accountable to citizens here.

Monday 9 May 2011

Lobby Briefing 9/5/2011

With the new chumminess ban in place there was decided ambivalence toward any attempt to mark the one year anniversary of the Coalition at the Lobby briefing this morning.

The PM’s spokeswoman made clear there were “no plans for a press conference” and no specific event planned for the day itself (Wednesday), instead the cabinet would celebrate by “ensuring [they] are continuing to deliver on the Coalition programme”.

With the NHS reform debate looming today the spokeswoman added that the "listening exercise" designed to consult on the planned changes would finish next month, but declined to reveal details of what would happen when it did.

The Guardian’s Nick Watt cheekily asked whether the exercise's panel would be listening to the Health Secretary at all. Much of the briefing, however, focussed on details around the impending referendum on Scottish independence.

The PM has made clear that he will not block a referendum, and that he opposes independence. What isn’t clear is whether independence can be ratified without legislation being passed in Westminster.

That raises a whole bunch of questions for the PM over whether he would oppose such legislation or not, whether the rest of the UK would have a say in Scottish independence at that point.

Predictably the spokeswoman was not prepared to speculate.