The European Finance Ministers are meeting in Brussels on Tuesday 11 March to discuss defence, tax cooperation and simplification.
On this subject, the Commission will be presenting Ministers with its two ‘omnibus’ simplification packages aimed at boosting competitiveness. The reform includes a proposal to revise the InvestEU Regulation in order to mobilise up to €50 billion in additional private and public investment (see EUROPE 13588/4).
Defence. Over breakfast on Tuesday, the Ministers will discuss financing options for the sector. “They will discuss the most urgent solutions, but nothing will prevent them from discussing longer-term solutions”, said a European source on Friday 7 March.
With the Commission due to prepare the legislative proposals for the ‘REARM Europe’ package (see EUROPE 13594/1) between now and the European Council on 20 and 21 March, the Ministers will specifically discuss how the Stability and Growth Pact can contribute to the EU’s rearmament effort, notably through the activation of the ‘national escape clause’ by those Member States that wish to do so. These discussions will focus on the European framework for this clause, which allows deviations from the agreed public spending path in order to limit its scope (limit set at 1.5% of national GDP) and duration (the Commission is considering an initial period of four years).
In a note sent to Member States, the Polish Presidency of the EU Council argues for a broad interpretation of the types of investment that can be made, which would include expenditure on military personnel recruitment, plant construction and dual-use infrastructure. As regards the timeframes to be taken into account, it points out that public defence contracts often cover “periods of 10 years or more”.
See the Polish note: https://aeur.eu/f/ftq
See the invitation letter from Minister Andrzej Domański: https://aeur.eu/f/ftu
Warsaw has also launched work on a specific code of conduct linked to the flexibility of the Stability Pact to encourage
On Monday evening, the Finance Ministers will have discussed other options for financing the defence sector, with a view to the presentation of the Commission’s specific ‘White Paper’ on Wednesday 19 March (see EUROPE 13574/1).
Russia. The Ecofin Council will discuss the way in which European customs apply EU sanctions against Russia and their role in preventing the sanctions from being circumvented.
RRF. Without debate, the Ministers will adopt an assessment of the post-Covid-19 recovery plans for Belgium and Ireland.
The amendment to the Irish plan concerns seven measures that can no longer be finalised for objective reasons, in areas such as training in digital skills, electrification of the rail sector in Cork and decarbonisation of businesses.
See the assessment of the Irish recovery plan: https://aeur.eu/f/fts
The amendment to the Belgian plan concerns a measure linked to the end of career and pensions of federal civil servants.
See the assessment of the Belgian recovery plan: https://aeur.eu/f/ftr
Taxation. The EU Council aims to reach a political agreement on the Directive on Administrative Cooperation in the field of taxation (‘DAC 9’) (see EUROPE 13578/25).
This text is intended to transpose into Community law the OECD information return, which contains data enabling tax administrators to assess a multinational company’s compliance with the worldwide rules against erosion of the tax base (‘GloBE Information Return’ or GIR).
In its note, the Presidency explains that all delegations could support the compromise text, with the exception of the provisions governing the method to be used to update the standard form of the TTIR so that it remains aligned with any updates to the ‘GloBE’ information declaration. According to our information, some Member States are opposed to the provision that would give the Commission the power to carry out these future updates rapidly by means of delegated acts.
To resolve this problem, Poland has proposed that the form be amended by an EU Council Directive under the special legislative procedure. “I can’t tell you 100% that we will reach a political agreement, but our aim is to do so, and I think it’s likely that we will, so I’m optimistic”, said a European diplomat on Friday 7 March.
Read the compromise proposal: https://aeur.eu/f/fu1
Read the note: https://aeur.eu/f/fu2
The EU Council will also be asked to approve, without debate, conclusions on the reduction and simplification of tax burdens and to formally adopt the package of measures on value added tax in the digital age (‘ViDA’), which was approved last November (see EUROPE 13518/13).
Financial services. The Presidency will present the state of progress of legislative proposals relating to financial services. In addition, the retail investment strategy (see EUROPE 13543/22) is due to be the subject of difficult interinstitutional negotiations (trilogue) on Tuesday 18 March. (Original version in French by Anne Damiani, Mathieu Bion and Bernard Denuit)