The European Commission has altered the timeline and content of its upcoming tax initiatives, initially expected for 10 June…
European Commission’s tax timeline shifts
The European Commission has altered the timeline and content of its upcoming tax initiatives, initially expected for 10 June.
The Commission now intends to launch on 15 July three initiatives:
Action Plan to fight tax evasion and to make taxation “simple and easy”
Communication on tax good governance “in the EU and beyond”
Proposal to amend the Directive on Administrative Cooperation to include the exchange of information from online platforms (DAC 7)
Moreover, the Commission’s earlier plans to launch a Communication on business taxation for the 21st century, initially scheduled for 24 June, is now absent from the Commission’s planning. This is probably due to the OECD announcing that it would seek a political agreement on digital taxation by October only, rather than July (see article below).
European Commission announces new Communication on tax good governance
Replying to a question from Accountancy Europe, the European Commission’s DG TAXUD announced on 30 April its intention to publish a new Communication on tax good governance “in the summer”. This Communication would complement the already announced Action Plan on tax fraud, and new measures on tax administrative cooperation (DAC 7) that would bring data from online platforms into the realm of exchange of information. Both initiatives are currently scheduled for 10 June.
For the time being, there are no further details announced on the contents of the tax good governance Communication. However, this may relate to the Commission’s earlier announcement on launching an External Strategy on taxation.
Commission says EU plastic tax could finance 4% of EU budget
OECD announces delay in digital taxation agreement to October
The OECD has announced that it now plans to reach an international agreement on digital taxation in October, rather than the initially planned July deadline. However, the aim is to still finalise an agreement by the end of 2020.
Although no specific date has been confirmed yet, the most likely forum for the agreement will be the 15-16 October G20 finance ministers’ meeting. However, some aspects of an agreement may have to be delayed and agreed in separate stages in 2021. Moreover, Mr. Saint-Amans said that the corona crisis has given new momentum to minimum tax (Pillar II) discussions.
OECD’s Pascal Saint-Amans made the announcements at a webinar on 4 May.
France to impose digital tax this year regardless of any new international levy
France will introduce a new tax on big digital businesses this year whether or not there is progress towards an international OECD agreement, the French finance minister Bruno Lemaire said on Thursday 13 May. He added that given the corona context and economic strain caused by it, such a tax had never been more legitimate or more necessary.
European Commission proposes deferrals to tax intermediaries Directive’s reporting deadlines and the VAT e-commerce directive and regulation due to corona
In the area of VAT, the Commission has proposed to postpone the entry into application of the VAT e-commerce package by 6 months. These rules will apply as of 01/07/2021 instead of 01/01/2021. For the proposed VAT deferrals, see here, here and here.
ECON Committee discusses corona response with Dombrovskis and Gentiloni
ECON Committee of the European Parliament has held an online hearing with Commissioner Gentiloni and Commission Vice-President Dombrovskis to discuss the EU’s response to the corona crisis.
At the hearing, several MEPs asked the Commission to elaborate on their efforts to fight against tax avoidance and evasion, confirming that the ongoing corona crisis has not removed tax from the top of the European Parliament’s agenda – perhaps even to the contrary.
For example, Sven Giegold (Greens-EFA/Germany) and Eero Heinaluoma (S&D/Finland) underlined that the corona context reinforces the need to fight against tax avoidance and evasion. Evelyn Regner (S&D/Austria) questioned state support to businesses that are based in ‘tax havens’ and called for public CBCR.
In his reply, Commissioner Gentiloni emphasised that taxation remains a priority for the Commission, and that Commission measures should be expected in June. For now the Action Plan on the fight against tax evasion is scheduled for 10 June, the Communication on business taxation for the 21st century for 24 June and a newly announced Communication on tax good governance coming in “summer”.
France: EU should tax fossil fuels to protect green goals
Rock-bottom fossil fuel prices caused by the pandemic should not be allowed to undermine the EU’s ambition to move to CO2-free energy, France has said. “The cost of fossil energies should be proportionate to their true environmental impact,” France said in a letter to EU energy ministers, meeting in Brussels Tuesday, Reuters reports. Fuel taxes and higher prices for carbon-emission credits in an EU trading system could help, France said.