Luxembourg, 09/06/2005 (Agence Europe) - The Ecofin Council has not reached an agreement on the legislative proposal to amend the 2003/49/CE directive on a common tax regime for interest and fees paid between associated companies in different Member States. Belgium is blocking an agreement that requires unanimity at the Council. The draft directive poses a number of difficulties to certain entities - coordination centres - presented on Belgian territory. These coordination centres are companies within multinationals and whose exclusive goal is to provide certain services (finance, treasury management, accounts or consulting) of other companies in the same group. These centres were supposed to disappear in 2010 and are taxed on a flat-rate base and not on at source basis. They are opposed to being included in the field of application in directive 2003/49/CE.
At the end of 2003 the Commission proposed getting rid of all taxes on interest payments and fees in Member States where these fees come from, whenever the beneficiary of interest and payments is a company in another Member State. In order to prevent tax evasion, exoneration is subordinated to taxation in the Member State where payment and fees are made out. The proposal also includes the updating of the list of companies covered by the 2003/49 directive with that for directive 90/435/ECC known as the “parent and subsidiary companies” directive and including the European company and European cooperatives in the field of application.