The election of Donald Trump and his decision to withdraw the United States from the international reform of the corporate minimum tax occupied a large part of the exchange of views between the European Parliament’s Subcommittee on Tax Matters (FISC) and Wopke Hoekstra, Commissioner for Climate, on Thursday 6 February. They also talked about European competitiveness.
Fernando Navarrete Rojas (EPP, Spain) asked Mr Hoekstra directly how the Commission intended to respond to the withdrawal of the United States. “In my view, it is evident that Europe must rethink the direction of global discussions on taxation”, he said. “Imposing a restrictive set of unilateral rules in isolation on our capacity to attract investments, to foster innovations, thus eroding EU competitiveness, does not seem to make much sense”, he commented.
Conversely, Bruno Gonçalves (S&D, Portuguese) asked the Commissioner whether he intended to maintain his commitments and implement the OECD’s global agreement on the taxation of multinationals. “Can we count on you to implement a tax on the digital giants, as you rightly mentioned at your confirmation hearing (see EUROPE 13513/9), despite these threats, or will Europe continue to be a haven for American billionaires’ growing wealth”, he enquired.
“One, is we will, at the beginning of April, meet with the broader group of allies in the domain of the OECD, and see what it actually is that, where the US actually wants to go, and what will be a calibrated and smart response”, replied Mr Hoekstra. “In parallel, what I do want to do is proactively discuss these issues with Member States”, he added. As far as the digital services tax was concerned, he stressed that the logic of why we needed it was unchanged and that it was a question of fairness.
Given that European businesses are likely to suffer as a result of this geopolitical shift, several MEPs welcomed the Commission’s announcement of a 28th legal regime, set out in the ‘Competitiveness Compass’ (see EUROPE 13567/31). It should simplify the applicable rules and reduce the cost of failure, including all aspects of company law, insolvency, employment and tax law. (Original version in French by Anne Damiani)