EU Relaunches Ambitious Corporate Tax Reform
Fahad Shabbir (@FahadShabbir) Published October 25, 2016 | 11:55 PM
BRUSSELS, , (APP - UrduPoint / Pakistan Point News - 25th Oct, 2016 ) - The European Commission on Tuesday relaunched an ambitious corporate tax reform package it says will boost the economy and reduce abuses after a series of high-profile tax cheating scandals sparked public uproar.
The Commission, the executive arm of the European Union, said that after failing in 2011 to win support, it had listened to member states and had now produced a more business-friendly version. "We are proposing a system which can simultaneously support business, attract investors, promote growth and stop large-scale tax avoidance," EU Economic and Financial Affairs Commissioner Pierre Moscovici said in a statement.
"My message to our member states today is this -- Let's seize this opportunity, and quickly, to deliver the fairer, more competitive, more growth-friendly corporate tax system that the EU needs," Moscovici said.
The original proposal ran into strong opposition from some member states, especially Britain, who objected to Brussels having a say in tax matters which are meant to be decided only by national governments.
Member states currently set their own tax rates which vary quite widely across the 28-nation bloc. The proposal also fanned suspicion that the European Union wanted to standardise the tax base as a prelude to winning the right to levy its own taxes to fund its activities, a step seen by some as a step too far toward a Federal Europe.
EU Vice-President Valdis Dombrovskis said "tax policy should support the EU's goals of economic growth and social justice." "Today's proposals aim to boost growth and investment, support enterprise and ensure fairness," he said in the statement with Moscovici.
- Single tax return - ===================== In a first step, the Commission proposes setting up a Common Consolidated Corporate Tax Base (CCCTB), meaning that "companies will for the first time have a single rulebook for calculating their taxable profits throughout the EU.
" This CCCTB system will be "mandatory for large multinational groups which have the greatest capacity for aggressive tax planning, making certain that companies with global revenues exceeding 750 million Euros ($825 million) a year will be taxed where they really make their profits." It will also encourage companies to raise funding by issuing shares rather than via bank borrowing, an important change to European business culture.
The statement noted that tax rates are not mentioned in the CCCTB as "these remain an area of national sovereignty." "However, the CCCTB will create a more transparent, efficient and fair system for calculating the tax base of cross-border companies, which will substantially reform corporate taxation throughout the EU," it said.
The Commission, which under former Luxembourg Premier Jean-Claude Juncker prides itself on taking political initiatives, said companies would now be able to file just one tax return for all their EU activities, saving time and money.
Juncker has made cracking down on tax cheats a high-profile priority of his Commission but he himself has also been snagged by several cases involving sweetheart tax deals with major multinationals arranged during his time as Luxembourg premier.
The Commission first raised the issue in 2001 and has worked over the years to try and convince member states. Moscovici said "a lot has changed" since 2011, arguing that the CCCTB plan was "more relevant today than ever." The latest CCCTB proposals will now be submitted to the European Parliament for discussion.
Related Topics
Recent Stories
Journalists call for global action to end Gaza’s humanitarian crisis
CM for generating opportunities to bring direct int'l investment
Pakistan retains position in FTSE secondary emerging market
High Commissioner of Malaysia hosts Iftar dinner reception
NEPRA announces 2nd quarterly adjustment in power bills with Rs 1.68 cut per uni ..
Hoopo Inc. Collaborates with SAU to Install Solar-Powered RO Plant
04 killed in Spain as Storm Nelson looms
Russian military jet crashes into sea off Crimea: Governor
Rain-windstorm/thunderstorm likely at various parts of country
Implementation of Sindh Agriculture Workers Act-2019 demanded
Pandemic accord talks heading for extra time
Khawaja reiterates PM commitment to judiciary
More Stories From World
-
Bus plunges off S.Africa bridge killing 45: ministry
5 hours ago -
S.Africa's ex-president Zuma barred from May election
5 hours ago -
Tax the rich: slow progress on the international front
6 hours ago -
Bus plunges off S.Africa bridge killing 45: ministry
6 hours ago -
Russia sentences journalist to 2 years in prison, detains others
6 hours ago -
France asks for foreign help for Olympics security: officials
6 hours ago
-
04 killed in Spain as Storm Nelson looms
7 hours ago -
Russian military jet crashes into sea off Crimea: Governor
7 hours ago -
Pandemic accord talks heading for extra time
7 hours ago -
French parliament backs bill against hair discrimination affecting black women
7 hours ago -
Russia says 'evidence' links Ukraine to Moscow attack
7 hours ago -
Russian shelling kills three in Ukraine, officials say
7 hours ago