Brussels, 08/06/2016 (Agence Europe) - On Wednesday 8 June, the European Parliament adopted, by 487 votes in favour, 88 against and 103 abstentions, the report by Belgian Socialist MEP Hughes Bayet, which adds to and tightens up the Commission's proposal for an anti-tax avoidance directive for multinational companies (see EUROPE 11567). The EP is only consulted on taxation issues.
Amongst other things, the report limits at 20% and up to €2 million deductions of loan interest paid by companies, the provision which states that profits entering Europe will be taxed at the legal rate of the country of entry if they have not previously been taxed at a level of at least 15% outside the EU, and limits the use of the mechanism of depositing patents, by clarifying the definition of investments in research and development.
“While the original Commission proposal was not perfect (…), this report makes things worse”, said the Belgian MEP Sander Loones (ECR). The ECR group did not endorse the report.
Chas Roy-Chowdhury of ACCA, which represents the accountancy profession, spoke very much along the same lines, arguing that the EU should not go beyond the OECD standards. Amongst other things, he urged the European ministers to make sure that certain elements, such as the reduction of interest, do not constitute unnecessary burdens to the European economy. Businesses' expenditure should be fully tax-deductible, he added. (Original version in French by Elodie Lamer)