European Commission Vice-President for a Europe Fit for the Digital Age, Margrethe Vestager, briefed MEPs on Tuesday 23 March in the European Parliament’s Subcommittee on Tax Matters (FISC) on the future proposal for a digital levy.
“Finding a global solution remains a key priority for the Commission and this is why we are working to develop a design that does not interfere with the OECD process”, she said.
The Commission is indeed bound by the interinstitutional agreement on the 16 December 2020 budget and must present a proposal for a digital levy by June.
The Commission services are currently considering different options, Ms Vestager said, but the digital levy should be compatible to the OECD solution, she pointed out.
“We are working hard to ensure that the design of such a digital levy cannot be seen as discriminatory and does not fuel trade tensions in any way”, she said.
Any solution should also include a real, stable and sufficient contribution to the budget as its own resource.
The Vice-President also welcomed the own-initiative report on digital taxation, adopted the same day by the Committee on Economic and Monetary Affairs (ECON), which supports an international agreement at the OECD by June 2021 on international tax reform, but also asks the EU to have a plan B in case of failure (see EUROPE 12684/24).
“We are optimistic that the new US administration is really serious about reaching an agreement on both pillars and will provide a window of opportunity for us all to move forward swiftly”, she said, even though there are still differences to be overcome within the OECD.
Several MEPs, including Stéphanie Yon-Courtin (Renew Europe, France) and Claude Gruffat (Greens/EFA, France), also asked her about the possibility of using Article 116 of the TFEU to get around the unanimity requirement for taxation in the EU Council.
In this respect, Ms Vestager was rather cautious. This Article of the Treaty should not be used to circumvent the unanimity principle itself, but to solve very specific problems, she recalled.
The Article allows the Commission to present a legislative proposal on taxation by qualified majority, instead of unanimity, if it finds a distortion of competition in the single market. If all the conditions are indeed met, the Commission will not hesitate to use it, she said. (Original version in French by Marion Fontana)