MEPs on the Committee on Economic and Monetary Affairs (ECON) adopted, on Thursday 22 February by 28 votes to 3, with 2 abstentions, their opinion on the proposal for a directive regulating transfer pricing.
This text should make it possible to reduce cases of double taxation and double non-taxation for cross-border transactions, thereby enhancing tax predictability.
In their position, MEPs want the European Commission to be able to adopt delegated acts to lay down further rules aimed at simplifying the application of the arm’s length principle in the Union, such as the introduction of safe harbours. For them, this would guarantee greater tax certainty and reduce the risk of double non-taxation and double taxation, as well as reducing tax disputes and tax abuses.
“It was important to have any future changes to the directive happen through delegated acts and strengthen the role of the Parliament”, commented the rapporteur, Kira Peter-Hansen (Greens/EFA, Danish), in a press release.
“Also the role of academia, business representatives and civil society will be strengthened through our proposal to re-instate the Joint Transfer Pricing Forum”, she added. The MEPs are suggesting that the EU Joint Transfer Pricing Forum be re-established. Chaired by the Commission, it should provide advice and assistance to the Committee, in particular in assessing the need to adapt this Directive with a view to ensuring continued uniformity of transfer pricing methodologies within the EU and globally.
The Forum would be made up of representatives of the Member States and a balanced representation of taxpayers, academics and civil society. The European Parliament would be an observer member.
MEPs are proposing to extend the European Trust and Co-operation Approach (ETACA). The scope of ETACA will include transfer pricing reviews of specific intra-EU flows by participating Member States and not only low value-added transactions, as is currently the case.
The MEPs also want to bring forward the entry into force of the directive by one year, from 2026 to 2025.
“Additionally, our text acknowledges that although the OECD Transfer Pricing guidelines currently hold sway in the EU, there is potential for the emergence of alternative guidelines in the future which could be relevant to the EU”, said Ms Peter-Hansen. “Now I urge Member States to follow our pace in coming to an agreement on this important text”, she concluded.
The opinion still has to be approved at the plenary session. On the EU Council side, the text is still blocked (see EUROPE 13336/15).
To read the compromise amendments: https://aeur.eu/f/ay7 (Original version in French by Anne Damiani)