asked the Minister for Finance the view of the Commission in relation to the rating of VAT on books and to the harmonisation of taxation regulations under the Treaty of Rome; and if any action is planned by the Commission.

I assume that the Deputy's question concerns the Commission of the European Communities. In relation to the zero-rating of VAT on books, the Commission have written to the Government asking for our observations on the matter. These observations are being sent to the Commission.

As regards the harmonisation of tax regulations under the Treaty of Rome, this is a basic objective of the European Community and is being pursued by the Commission gradually in the various tax areas.

Could the Minister tell me if there is any truth in the view that the Government have agreed to pay extra funds to the Commission to make up for the loss of VAT on books?

I have already stated in my reply that the Commission have written to the Government about this matter and asked for our observations. Those observations are being sent and they do not contain any such offer.

Have the Commission made any request for a substitution of funds to make up for the lack of VAT on books?

No.