Luxembourg, 16/06/2016 (Agence Europe) - On Friday 17 June, the European finance ministers will seek to reach a unanimous political agreement on the proposed anti-tax avoidance directive and to agree on the most detailed roadmap possible on the completion of banking union in the eurozone.
This Friday 17 June, the Ecofin Council will be dealing with two separate tax dossiers, but which have become connected due to circumstances. This is because the Czech delegation is threatening to scupper an agreement on the anti-tax avoidance directive if it is not given permission to launch a pilot project for a reverse-charge mechanism to fight value-added tax (VAT) fraud. On Friday, the Commission will present its analysis of the request made jointly by the Czechs and the Austrians for this pilot project. It states that it is by no means certain that a temporary derogation to the VAT rules for a project of this kind would “make carousel fraud impossible and there is a risk that other forms of carousel fraud, both intra-EU and national, would emerge”. Testing a pilot project may make it possible to verify these points, however, it added. The outcome of the discussions on the anti-tax avoidance directive may therefore depend on the discussions on the fight against VAT fraud. However, other issues related to specific provisions of the directive were raised by various national ambassadors to the EU as recently as Wednesday 15 June (see EUROPE 111573).
FTT. The ministers will then hear from their counterparts participating in the enhanced cooperation on financial transactions tax about the progress made over the last six months (see other article).
Banking union. The ministers will be called upon to react to the brief roadmap submitted to them by the Dutch Presidency (see EUROPE 11573) on the completion of banking union, by means of the creation of the EDIS deposit insurance system. This roadmap aims to include measures to reduce financial risks, such as the treatment of banks' exposure to sovereign debts, in this work. Esther de Lange, the rapporteur of the European Parliament, feels that this is vital (see other article).
In the budgetary field, the Ecofin Council will complete the excessive deficit procedures opened against Cyprus, Ireland and Slovenia, three eurozone countries which have sustainably brought their deficit below the 3% of national GDP mark. It will also adopt the socio-economic policy recommendations, based on Article 121 of the Treaty, which the Commission has submitted to the 28 member states. Only the part pertaining to the budgetary grace periods which may be granted to Spain and Portugal to bring their deficit within the bounds of the Stability Pact will be put on ice, pending specific proposals from the Commission in early July, and based on Article 126 of the Treaty (see EUROPE 11573). Taking stock of the deepening of economic and monetary union, the ministers will reach a political agreement on establishing a network of national authorities responsible for promoting productivity.
Following an analysis of the implementation of the Juncker investment plan, the ministers are expected to send out a signal in favour of extending the plan by one or two years (see other article).
Finances. The Ecofin Council will approve the political agreement in principle reached on the proposed regulation to create a European framework for money market funds (see EUROPE 11571). After two years of negotiations between the states, talks with the European Parliament will be able to start. The ministers will also confirm the political agreement on the proposed regulation to modify the rules on the prospectus that European companies must publish when they wish to raise capital, in order to provide potential investors with information (see EUROPE 11569). (Original in French by Élodie Lamer)