Czech Finance Minister Zbyněk Stanjura warned against a race to the bottom between Member States to deal with the repercussions in the European Union of the Russian invasion of Ukraine, during an exchange of views with the European Parliament’s Committee on Economic and Monetary Affairs (ECON) on the priorities of the Czech Presidency of the Council of the EU on Wednesday 13 July.
Asked by Markus Ferber (EPP, German) about possible measures to control soaring inflation, mainly due to rising energy prices, Mr Stanjura called for the implementation of a “responsible fiscal policy”. “Downward tax competition is not a solution, in my view”, he said.
“The decisions of other governments can create pressure. Some issues can only be solved at European level, such as the energy price cap”, he continued, wanting to ask the European Commission for an internal market assessment of the extraordinary measures adopted by the EU27.
Several MEPs also asked Mr Stanjura how to facilitate a lifting of the Hungarian veto on the Directive transposing the OECD agreement on minimum taxation of companies in the EU (see EUROPE 12974/8).
“As President, it is my responsibility to find an agreement with the Hungarians. I will spend the summer there, because I hope to reach an agreement in October”, he announced. He stressed that this agreement was “fundamental” vis-à-vis the US partner, without which an agreement on Pillar I regarding digital taxation would be compromised.
However, he dismissed the idea of enhanced cooperation, raised by Rasmus Andresen (Greens/EFA, German). As for the end of unanimity voting in tax matters, called for by the Parliament in particular (see EUROPE 12988/6), he felt that there were more urgent matters to be dealt with.
On the budgetary front, the Czech Minister did not deny the difficulty of finding a balance between “social peace and budgetary discipline”, while at the same time promoting massive investment in climate transition, which he said would have the advantage of reducing Europe’s dependence on Russian hydrocarbons and decarbonising the EU’s economy.
In this respect, Mr Stanjura hoped that the EU Council would reach a political agreement in autumn on the financing of the REPowerEU strategy in order to reach a final agreement with Parliament by the end of 2022.
As for the reform of fiscal rules, this debate will come to life with the Commission’s proposal expected in autumn, with the Czech Republic acting as a “moderator” in the discussions between Member States. For Mr Stanjura, “past rifts” between Member States are no longer relevant after the budgetary approach to the Covid-19 pandemic and now the repercussions of the Russian military invasion of Ukraine. Asked by Marek Belka (S&D, Polish), he did not totally close the door on the creation of a ‘golden rule’ that would allow the exclusion of certain expenditure from the calculation of the public deficit. And, according to the Minister, the EU Council did not discuss the continuation of the Next Generation EU Recovery Plan. (Original version in French by Anne Damiani and Mathieu Bion)