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.
  

