The European Parliament’s Committee on Economic and Monetary Affairs (ECON) and Subcommittee on Tax Matters (FISC) met in Strasbourg on the evening of Monday 9 February to discuss the European Commission’s work programme with Wopke Hoekstra, Commissioner for Climate, Net Zero and Clean Growth.
MEPs expressed frustration and incomprehension at the withdrawal of five tax proposals: - a financial transaction tax; - transfer pricing (see EUROPE 13523/19); - ‘Unshell’, on the use of shell companies for tax purposes (see EUROPE 13438/26); - the authorisation of qualified majority voting on VAT; - ‘DEBRA’, relating to a franchise for the reduction of tax incentives favouring indebtedness (see EUROPE 13133/17).
“Therefore, we were very surprised not to find in the work programme the specific reason behind the withdrawal of each proposal, especially as this falls short of the requirements set out in the Interinstitutional Agreement on Better Law-making and the Framework Agreement”, said Aurore Lalucq (S&D, French) as she opened the session.
“I feel your pain because I understand why many of these proposals have been put on the table before and what the merit of them is”, replied Mr Hoekstra. “Each and every one of the underlying principles and logic are still very much valid”. However, he explained that the political, geopolitical and economic contexts have changed considerably. All these issues have been held up in the EU Council for some time. Mr Hoekstra said that the decision to withdraw them had been carefully considered.
“I understand that if you feel that 20 out of 27 don’t want it (DEBRA), that it’s not possible. But if there would be at least partial agreement on that, this would sooner or later drag the others in because they wouldn’t like to have their companies at a competitive disadvantage”, defended Luděk Niedermayer (EPP, Czech). The Commissioner committed to examine the legal framework needed to apply the logic of enhanced cooperation.
For her part, Lara Wolters (S&D, Dutch) called for the introduction of a European tax on digital services, as provided for in Pillar I of the OECD agreement (see EUROPE 13707/5). Mr Hoekstra replied that four Member States have already introduced it. He considered it preferable to act on a European scale rather than leave 27 Member States to act individually, in order to avoid the risk of fragmentation. (Original version in French by Anne Damiani)