The reinforcement of defensive measures taken by the 27 Member States to combat harmful tax regimes and corporate tax evasion has not closed all the gaps, concludes the EU’s Court of Auditors in its new report, published on Thursday 28 November.
The Court therefore recommends: improving the quality of reports related to the directive on administrative cooperation in tax matters (DAC 6) (see EUROPE 13465/26); ensuring that the penalties provided for in this directive have an adequate effect; strengthening its support for the EU Council’s Code of Conduct Group; monitoring the results and impact of the fight against harmful tax regimes and corporate tax avoidance.
The European Commission’s annual report on taxation 2023 highlighted the loss of tax revenue due to aggressive tax planning and corporate tax avoidance. These losses could amount to €172.7 billion worldwide, including €68.2 billion in Europe. Corporate income tax studies estimate that the worldwide transfer of profits has resulted in a total loss of tax revenue of between €183 billion and €274 billion.
“The EU could only build a first line of defence because EU countries themselves are in the driving seat for direct taxation matters“, the Court emphasised. “Using its narrow powers in this field, the Commission should plug existing gaps [and] develop its guidance for EU countries so as to ensure a united front against harmful tax practices”, said Ildikó Gáll-Pelcz, the member of the Court responsible for the report. It should also “accelerate a common performance monitoring framework”, she added.
Read the report: https://aeur.eu/f/eik (Original version in French by Anne Damiani)