To ask Her Majesty's Government further to the answer by Lord Myners on 25 February (Official Report, House of Lords, col. 1083), why they are supporting a European Commission proposal for an exchange of information agreement with Monaco for tax purposes when the European Commission has no competence in relation to direct taxes. [HL2392]

The European Union has no competence to determine rates of direct taxation, which are a matter for member states. The EU shares competence with member states in the area of exchange of information and administrative co-operation for the purpose of combating fraud and protecting the single market against cross-border tax evasion.