EU economics commissioner Pierre Moscovici reiterated his commitment to re-launch the Common Consolidated Corporate Tax Base yesterday, urging all EU member states to ensure that companies pay their fair share of tax.
Speaking following a meeting of EU finance ministers in Luxembourg, Mr Moscovici said there had been broad acceptance by member states that aggressive tax-planning needed to be challenged.
He also vowed to ensure that the concept of “consolidation” – which deals with how profits and losses are treated across countries – is included in the proposal, despite the European Commission proposing in May that this element of the package be deferred as a part of a “two-phase” approach.
“We are ready to envisage a two-phase approach , first building a common base for taxation, then to move to consolidation, but, to be clear, I do not renounce consolidation,” he said yesterday.
Ireland is strongly opposed to the idea of a common corporate tax base, which was first proposed by the commission in 2011, but failed to garner enough support from member states.
The commission announced a drive to re-launch the project in May as part of a broader clampdown on corporate tax avoidance in the wake of the Luxembourg Leaks scandal which revealed how thousands of companies had reduced their tax bill through the use of tax rulings.
Aggressive tax
Yesterday’s meeting of EU finance ministers, which was attended by Minister of State Simon Harris, including a discussion on minimum effective taxation, following pressure from France and Germany to put aggressive tax planning on the agenda.
A number of member states, including Ireland, Sweden, the Netherlands and Britain are strongly opposed to any moves by the commission to move towards a harmonisation of tax bases which they see as a preserve of member states.
Speaking following the meeting, Mr Harris said that Ireland had engaged fully with the discussion on aggressive taxation policies, but was fully committed to the OECD process.
“There was a very good engagement on aggressive tax planning. Ireland alongside all European colleagues wants to see procedure put in place to prevent such actions. We outlined that we believe is the best way of dealing with this, through the OECD BEPS process, and we look forward to the BEPS report being published in the coming weeks.”
Migration crisis
Yesterday’s informal Ecofin meeting also dealt with the migration crisis, with member states requesting the commission to consider relaxing EU debt and deficit rules to ensure that national spending on the refugee crisis are excluded from EU budget targets.
A number of countries including Austria, Luxembourg, the Czech Republic, and Ireland have called on the commission to ensure that national spending on the EU’s refugee relocation plan is taken into account in the commission’s examination of countries’ national budgets in October.
Eurogroup finance ministers are due today to take stock on the Greek bailout for the first time since finance ministers signed off on a new €86 billion bailout package for Greece last month. Greece is due to hold snap elections on Sunday September 20th.
