EC COMMISSION DEFENDS OILS AND FATS TAX
A spokesman for the European
Community Commission defended the controversial plan for a levy
on oils and fats, saying that consumers would have to help
alleviate the surplus problem by paying the proposed tax.
    Norbert Tanghe, head of division of the Commission's
Directorate General for Agriculture, told the 8th Antwerp Oils
and Fats Contact Days "the Commission firmly believes that the
sacrifices which would be undergone by Community producers in
the oils and fats sector ... Would justify asking consumers to
make an appropriate contribution to solving the serious problem
within that sector by paying a levy."
    The proposed tax is necessary because the level of
budgetary costs resulting from olive oil and oilseeds
production has become unacceptable, Tanghe said.
    Recent estimates put these costs at 4.0 billion European
Currency Units and by 1990 they would rise by another 2.0
billion Ecus, he said. In 1990 the Community's "standstill"
agreements with Spain and Portugal end and the EC would then
feel the full impact of its enlargement.
    The Commission has proposed several cost and production
cutting measures which include the introduction of a maximum
guaranteed quantity system, he added.
    Under the Commission's system for stabilising consumer
prices in the oils and fats sector, a reference price of 700
Ecus per tonne for refined soy oil would be introduced, Tanghe
said.
    Consumer prices could be raised or lowered by a regulatory
amount when market prices are below or above this level.
    He said the revenue generated by charging a regulatory
amount would be used to finance the Common Agricultural
Policy's oils and fats regime.
    "The Commission believes that hostile reactions (to the
proposed tax) have for the most part been based on incomplete
or an insufficiently thorough analysis of the proposal," he said.
    Tanghe said the proposed system conforms with General
Agreement on Tariffs and Trade, GATT, rules.
    It would not be discriminatory because it would be applied
to domestic and imported products, and past experience showed
it would not cause any decline in consumption of oils and fats.
    EC-produced oilseeds would not benefit more than they do
under present aid arrangements, he said.
    The competitiveness between different oils, whether EC
produced or imported, would remain unchanged and quantities
imported from third countries would not be affected by the tax,
Tanghe said.
    The proposed system would not alter the EC nations'
requirements as far as imports are concerned since the overall
effect would stabilise Community production levels without
affecting demand, he said.
    It is one of the proposal's objectives to maintain current
import levels, he said.
    Imports of soybeans would be unaffected because they are
imported primarily to satisfy the EC's cakes and meals
requirements, which are not covered by the stabilising system.
Furthermore, more than half the oil produced from imported
beans is re-exported to third countries, Tanghe added.
 Reuter
