Filenews 16 July 2021
The European Commission has decided to send a letter of formal notice to Cyprus because it does not correctly apply EU VAT rules to dwellings purchased or manufactured in Cyprus. Letters of formal notice were sent to Cyprus and various other sectors.
As stated in a Commission communication, Cyprus allows the application of a reduced VAT rate of 5 % for the first 200 m2 of dwellings used as principal and permanent residence by the beneficiary, without further restrictions. In particular, it notes, the reduced rate applies irrespective of the income, assets and financial situation of the beneficiary, the family members residing in the residence, and the maximum total area of residence.
"Indeed, the VAT Directive allows Member States to apply a reduced rate of VAT to dwellings within the framework of a social policy. However, the fact that Cypriot legislation has a wide scope and does not provide for restrictions shows that the measure goes beyond the objective of a social policy."
Consequently, the Commission considers that Cyprus has failed to fulfil its obligations under the VAT Directive. Cyprus has two months to address the omissions highlighted in the letter of formal notice. If it does not take appropriate measures within the next two months, the Commission may decide to send a reasoned opinion.
Combating terrorism
The Commission also decided today to initiate infringement proceedings by sending letters of formal notice to Cyprus, the Czech Republic, Greece, Spain and Lithuania for not correctly transposing certain elements of EU rules on combating terrorism ((Directive (EU) 2017/541).
As it states, the Counter-Terrorism Directive is a key element of the counter-terrorism agenda and includes provisions criminalising and punishing terrorism-related offences, such as travelling abroad to commit a terrorist crime, returning to the EU or making trips within the EU to carry out such activities , training for terrorist purposes, and terrorist financing.
In addition, Union rules provide for specific provisions for victims of terrorism to ensure that such victims have access to reliable information, as well as professional and specialised support services, immediately after an attack and for as long as necessary.
Member States were due to transpose this Directive into national law by 8 September 2018. Cyprus, the Czech Republic, Greece, Spain and Lithuania now have two months to refute the Commission's objections. Otherwise, the Commission may send a reasoned opinion.
Data pairing services
In addition, the Commission decided today to send reasoned opinions to Cyprus, France, Greece, Malta, Portugal and Slovakia for not providing and operating data link services for all operators of properly equipped aircraft operating within the airspace under their responsibility.
It states that the deadline for providers to operate data link services has expired and the absence of equipment in some control centres effectively prevents aircraft operators, who were also required to equip themselves with the technology, from using data link services. The Member States concerned now have two months to take the necessary measures. Otherwise, the Commission may decide to refer the case to the Court of Justice of the European Union.
Posting of employees
The Commission decided today to initiate infringement proceedings by sending letters of formal notice to Belgium, Bulgaria, the Czech Republic, Denmark, Germany, Estonia, Ireland, Greece, France, Croatia, Italy, Cyprus, Latvia, Lithuania, Luxembourg, Hungary, Malta, the Netherlands, Austria, Poland, Romania, Slovenia, Slovakia and Finland for not aligning various national provisions with the Directive implementing the Posting of Workers Directive (2014/67/EU).
The Implementation Directive aims to strengthen the practical application of the rules on the posting of workers by regulating issues relating to the fight against fraud and circumvention of rules, access to information and administrative cooperation between EU Member States.
The Commission is engaged in a dialogue with the 24 EU Member States that have not correctly transposed some or all of the provisions of the Directive. The Commission intends to ensure that the current rules allow the continued posting of workers within the single market without unnecessary obstacles for employers, while safeguarding the rights of posted workers. The Member States concerned now have two months to take the necessary measures. Otherwise, the Commission may decide to send reasoned opinion
