Brussels, 13/11/2014 (Agence Europe) - On Thursday 13 November, the Commission listed a number of areas for reflection to flesh out the promises it made the day before on two fields of action to speed up the fight against tax optimisation, in the wake of the LuxLeaks scandal, but also against the backdrop of international developments under the aegis of the OECD.
LuxLeaks revealed hundreds of tax rulings granted in Luxembourg, allowing multinational companies to pay derisory levels of tax on their profits.
Revising the directive on administrative cooperation? The directive on administrative cooperation provides for an automatic exchange of information on tax rulings under certain circumstances. On Wednesday, the college of commissioners unanimously approved the foundation laid by European Commissioner for Economic and Financial Affairs, Taxation and Customs Pierre Moscovici for a new proposal to make this exchange compulsory. The most likely outcome is that Moscovici will propose a revision of the directive on administrative cooperation. “I would like to look at how transparency on tax rulings may also be assured through obligations on the beneficiary companies”, he explained before the European Parliament on Wednesday evening.
The OECD action plan to fight tax optimisation (BEPS) provides for the compulsory automatic exchange of information on rulings, with an agreement on this point expected by the OECD at the G20 meeting in Brisbane. “The EU is determined to go ahead, irrespective of developments at the G20”, Commission spokesperson Margaritis Schinas explained on 13 November, acknowledging the “movement” at this level.
End to optionality of CCCTB? The Commission also hopes to “breathe new life into a proposal at stalemate at the Council”, Schinas added, in reference to the CCCTB, or common consolidated corporate tax base. As Commission spokesperson Daniel Rosario stressed, the initial aim was to “deal with the issue of double taxation; we are keeping hold of that idea, but we want to adapt (the proposal) to new challenges”.
The CCCTB was discussed at the October Ecofin, in the framework of the BEPS. Several member states stressed that the progress in work on this instrument had been slow and called for swift progress on other dependent dossiers which could help in the fight against tax optimisation: the anti-abuse clause of the parent/subsidiary directive and the directive on interest and royalties. There are also plans to include an anti-abuse clause in the latter.
“The idea is to go as fast as possible and as far as possible”, Rosario explained. A further aim, he added, is to revise certain aspects to make it more effective in its response to tax base erosion. Speaking before the Europea Parliament, Moscovici explained that the “question as to whether the CCCTB should be optional” was an issue. In March 2012, members of the European Parliament, when consulted on the issue, were almost unanimous in calling for the compulsory application of the CCCTB to all businesses, with the exception of SMEs, following a five-year transition period after the adoption of the directive. At the time, the report was drawn up by Marianne Thyssen, who is now a European commissioner. Nor has it been ruled out that enhanced cooperation could be used to move tax harmonisation forward.
BusinessEurope, which represents European employers, has stated that it is in favour of greater transparency in tax policies, but is calling for legal security, stressing the fact that dialogue is necessary between tax administrations and business. (EL)