Upload
barry-washington
View
220
Download
0
Embed Size (px)
Citation preview
1
HOTREC and some of its
activities
VAT and smoking
Dániel MakayPolicy Advisor, HOTREC
Zagreb, 22 November 2010
2
Contents
I. Brief introduction to HOTREC
II. VAT
III. Smoking
IV. Conclusions
Zagreb, 22 November 2010
3
Represents
hospitality industry at European level
40 National Associations
in 24 European countries
Brief introduction to HOTREC
Zagreb, 22 November 2010
4
European hospitality sector in the EU-27
1,7 million enterprises (mainly micro enterprises)
9,5 million persons employed Automotive production: 2,2 million Chemical industry: 1,9 million
195 billion EUR value added Automotive production: 155 billion EUR Chemical sector: 194 billion EUR
Brief introduction to HOTREC
Zagreb, 22 November 2010
5
Brief introduction to HOTREC
Monitor EU developments of likely impact on the sector
Coordinate Members’ views
Lobby Institutions - Commission
- European Parliament
- Council of Ministers
What do we do?
Zagreb, 22 November 2010
6
Brief introduction to HOTREC
More than 80% of national legislation is made by the EU
Important to influence the law making process at the source, before being transposed at national level
Important role of national associations in contacting their MEPs and governments as well
Why is this work important?
Zagreb, 22 November 2010
7
VAT Smoking
Food labelling Hotel classification Quality Fire safety ...
Some of many issues:
Brief introduction to HOTREC
Zagreb, 22 November 2010
8
Background:
VAT in general in the EU: (Directive 2006/112/EC)
1 standard rate of not less than 15%
1 or 2 reduced VAT rates of not less than 5%
The reduced rates can be applied to the products and services listed in Annex III of the Directive (incl. accommodation and restaurant services)
VAT
Zagreb, 22 November 2010
9
Background:
VAT on accommodation and restaurant services
Before 1 June 09: Hotels: option: - standard rate (≥ 15%)
- reduced rate (≥ 5%)
Restaurants: in principle standard rate…except if already reduced rate before Jan 91 or negotiated in accession treaties (in total 11 countries)
After 1 June 09: all Member States allowed to apply reduced VAT rate ALSO to restaurant services (incl. all beverages)!
VAT
Zagreb, 22 November 2010
10
Background:
Future
Commission to launch broad debate on ”reforming” the EU VAT regime still this year
Legislative proposal not expected before end 2011 or 2012
To be watched very carefully!
VAT
Zagreb, 22 November 2010
VATBackground:
•Since 1 June 2009 3 countries introduced reduced VAT rate for restaurant services:
France
Belgium
Finland
•Under consideration in some other countries
Zagreb, 22 November 2010
VAT France
Change of VAT rate for restaurant services
•Before 1 July 2009:
19,6% on all restaurant services:
•After 1 July 2009:
5,5% on food and non-alcoholic beverages
19,6% on alcoholic beverages remains
Zagreb, 22 November 2010
VAT France
Background
•Long time promise of many governments to lower VAT for restaurant services
•Possible only following the agreement at EU level
•Main aim: all should benefit
Consumers
Employees
Restaurant owners
Zagreb, 22 November 2010
VAT France
Some results
•Cut of prices by majority of establishments
•Almost 30.000 more employees after 1 year
•4 types of hospitality jobs among 15 most popular jobs
•14% of all recruitement in the hospitality sector
•Wages up by more than 3%
•More restaurant business established than in the rest of the economy
Zagreb, 22 November 2010
VAT Belgium
Change of VAT rate for restaurant services
•Before 1 January 2010:
21% on all restaurant services
•After 1 January 2010:
12% on food
21% on non-alcoholic and alcoholic beverages
Zagreb, 22 November 2010
VAT Belgium
First results possible to see so far
•Number of backrupcies decreased
•Employment situation is stabilised
•Turnover increased by almost 7% in 1st quarter of 2010
•Many technicalities still to be clarified
Zagreb, 22 November 2010
VAT Finland
Change of VAT rate for restaurant services
•Before 1 July 2010:
22% on all restaurant services
•After 1 July 2010:
13% on food and non-alcoholic beverages
23% on alcoholic beverages
Zagreb, 22 November 2010
VAT Finland
First results
•Prices reduced by 5,7% so far (close to 6,6% compared to 100% participation)
•Turnover increased by 4,5%
Zagreb, 22 November 2010
VAT Germany - hotelsResults of the VAT reduction from 19 to 7% on rooms (1 January 2010):
•717,6 Millions of Euros spent on renovation, modernisation
•5.747 additional jobs out of which 2.150 full-time jobs
•32,2% of establishments have reduced their prices by an average of 6,5%
•29,2 Millions of Euros to increase wages,
•12,8 Millions of Euros for training
Zagreb, 22 November 2010
VAT Latvia - hotelsResults of the VAT reduction from 21 to 10% (1 May 2010):
•6.000 more persons employed
•Turnover increased by 5%
•Additional social and income taxes of ca. 21-26 millions EUR
VAT increase in 2009 from 5% to 21%
•12.000 fewer persons employed
•Decline in social and income taxes of 14 million EUR
Zagreb, 22 November 2010
VAT Arguments - Summary
Why a reduced VAT for restaurant services?
•Lower prices
•High price elasticity
•Job creation
•Reduction of illegal work
•Bringing people into employment
Zagreb, 22 November 2010
VAT Arguments - Summary
• More resources for training
• Investments in the sector: other sectors benefit as well
• Modernisation of the establishments
• Promotion of culinary heritage
Croatia and all EU Member States should make use of the
benefits of a reduced VAT rate applied to restaurant
services! Zagreb, 22 November 2010
EU policies against smoking
At European level developments related to smoking are linked to activities of World Health Organization
• WHO adopted anti-tobacco Treaty in 2003: Framework Convention on Tobacco Control (FCTC)
• Ratified by all EU Member States but Czech Republic
• Croatia ratified in 2008
• No EU legislation on smoking so far, but increasing pressure (e.g. DG Sanco, Health NGOs)
Smoking
Zagreb, 22 November 2010
EU initiatives against smoking
1) Council Recommendation on smoke-free environments adopted on 30 November 2009 (AT, SK, CZ abstained)
• Objective: to incite Member States to comply with their legal obligations stemming from the WHO anti-tobacco Treaty (Art. 8: protection from tobacco smoke)
• A non-binding measure but can put political pressure on those Member States without total smoking bans!
Smoking
Zagreb, 22 November 2010
EU initiatives against smoking
1) Council Recommendation on smoke-free environments
• Calls on Member States to adopt within 3 years (2012)
“Comprehensive legislative measures” against smoking
- i.e. smoking bans (without any exception) in all indoor public places, workplaces, etc.
- Legislation may cover “outdoor” or “quasi-outdoor” public places “where appropriate”…
Smoking
Zagreb, 22 November 2010
EU initiatives against smoking
1) Council Recommendation on smoke-free environments
• Member States to inform the Commission of legislative or other actions taken in response to Recommendation
• Possible impact on hospitality: Member States to revise and extend the scope of smoking bans (hotel rooms, terraces, etc.)?
Possible implementation at national level to be followed very carefully!
Smoking
Zagreb, 22 November 2010
EU initiatives against smoking
2) Initiative by DG Employment
Smoking
• Consultation on possible EU action to protect workers from passive smoking
• Still ongoing
• Outcome very uncertain
Also to be followed carefully!
Zagreb, 22 November 2010
Smoking bans at national level
Constant trend towards stricter smoking bans
Smoking (cont’d)
• Total bans on smoking in all enclosed public places including bars and restaurants: Ireland, UK, Cyprus, Finland
• Smoking bans allowing for special enclosed smoking rooms: Italy, Malta, Sweden, Slovenia, the Netherlands:
• Smoking allowed in smaller establishments: Austria, Denmark, Romania, most German Länder,
Legislation changes constatly in many countries!
Zagreb, 22 November 2010
HOTREC and EU initiatives against smoking
The position of HOTREC
•In view of recent legislative developments in the various Member States regarding smoking rules EU action is not needed and it could also interfere with national legislation
“HOTREC is of the opinion that the issue of smoking in public and work places is best tackled at national level, where local and practical conditions can be better taken into account”
Smoking (cont’d)
Zagreb, 22 November 2010
34
Conclusions
National associations and HOTREC The Future Areas dealt with by EU institutions is ever increasing
An ever increasing number of countries
Importance of strong lobby
Importance of close collaboration
Importance of exchange of experiences
Importance of being together!
Zagreb, 22 November 2010