The European Commission has decided to send requests for information in the form of letters of formal notice to Malta and several other member states about their application of reduced VAT rates to children’s diapers.

The Commission said yesterday it believes that reduced rates on these goods do not comply with the Sixth VAT Directive (77/388/EEC), which was revised for the last time in February 2006.

However, the Commission said it fully supports social and family friendly policies, as part of the EU’s response to the pressing challenge of demographic aging. For these reasons, the Commission will in parallel take the necessary steps in order to create a legal basis for the application of reduced VAT rates to children’s diapers.

The member states involved are asked to reply within two months to the letters of formal notice, which are the first step of the infringement procedure laid down in Article 226 of the EC Treaty. Their arguments will be taken into account in the report on the application of reduced VAT rates which the Commission will present to the ECOFIN Council in 2007. On the basis of this report, the Commission will draft a proposal in order to amend Annex H of the Sixth VAT directive as appropriate.

The Commission has decided to send requests for information in the form of letters of formal notice to the Czech Republic, Hungary, Malta, Poland and Portugal, which apply a reduced VAT rate to children’s diapers.