On Tuesday 23 January, the European Commission said that it was disappointed that the finance ministers had not adopted its recommendation for the Eurozone concerning fight against aggressive tax planning word for word.
“The question is how much we rely on international best practices, and there we would have liked to have more clear wording that the EU wants to be at the forefront and, if needs be, move ahead with initiatives which will probably go beyond the international consensus”, the Vice-President of the Commission with responsibility for the euro, Valdis Dombrovskis, told a press conference. The only change between the Commission's proposal and the text adopted by the Council is, however, fairly subtle. Where the Commission called upon the member states to continue the work “towards a common consolidated corporate tax base (CCCTB)”, the Council simply says “on a CCCTB”.
On behalf of the Bulgarian Presidency of the Council of the EU, Minister Vladislav Goranov explained that he wanted to establish the elements of the proposal over which the member states have no doubts and separate them off into a document. He added that he hoped to communicate in March or June on the elements on which there is already consensus.
In a document prepared ahead of a technical meeting on 18 January, of which EUROPE has had sight, the Presidency explains that as regards the tax deductions brought by the Commission into the CCTB (the proposed tax base not including consolidation), “most delegations have indicated that they are not ready to give up their sovereignty in this field, which renders harmonisation difficult”.
The first stage, therefore, would be to remove all deductions and other tax incentives that have been brought in. The Council may also consider removing the threshold of €750 million in turnover for companies for which the CCTB would be compulsory. This would mean that a common tax base of this kind could be defined for the Twenty-Eight. Secondly, the question of tax incentives could be discussed, but only concerning deductions, as tax credits as such are not covered by the proposal (as they come after the tax declaration) and therefore do not need to be harmonised. “Since unanimity is expected to be difficult to reach in this field, technical discussions could try to achieve consensus among as broad a group of delegations as possible, with a view to a possible future enhanced cooperation among the member states concerned (also involving consolidation)”.
It is worth noting that the association WeMoveEU submitted a petition on Tuesday, having collected 104,405 signatures in favour of a CCCTB in just a month. (Original version in French by Élodie Lamer)