Accountancy Europe speaks at European Parliament’s tax Committee
The FISC Subcommittee hosted a public hearing on 17 July, on Tackling the Role of Enablers Involved in Facilitating Tax Evasion and Aggressive Tax Planning in the European Union (SAFE). The purpose was to discuss the role of enablers in facilitating tax evasion and aggressive tax planning with a view to an expected proposal by the European Commission. In this hearing, experts were invited to present their views on the upcoming proposal.
Accountancy Europe’s CEO, Olivier Boutellis-Taft, underlined that aggressive tax planning (ATP) and evasion are substantial problems in the EU, but are essentially different issues that require different solutions. The evasion has to be dealt with by criminal law, he added. The ATP is a tax law issue, requiring better regulation as well as significantly higher sense of ethics and responsibility.
Olivier stressed that a common EU definition of ATP would be useful for taxpayers and authorities alike, provided it is implemented consistently. But the member states tend to go their own way sometimes. On the ground, the EU is not as united as they like to think, he lamented.
Finally, he reminded that Accountancy Europe has consistently supported increase in transparency in taxation as well as cooperation with tax administration through the so-called cooperative compliance. Resources for tax administration need to be increased to ensure that enacted tax legislation is also effectively enforced.
New Commission figures on VAT rules for e-commerce
In 2022, Member States collected more than €17 billion via the expanded One Stop Shop (OSS) portal which covers online sales within the EU. In addition to this, €2.5 billion in VAT revenues was collected on imports of e-commerce goods. This figure includes the new VAT revenues generated by the abolition of the VAT exemption that previously applied to imports of low value goods not exceeding €22 and which was highly susceptible to fraud.
Overall, VAT revenues collected via the new systems saw a 26% increase on 2021 figures. Almost 130,000 companies have registered to account for their VAT on online sales through the new framework, showcasing traders’ keen adoption of simplifications, as noted by the Commission.
Plenary adopts opinion on DAC 8, paving the way for its finalisation in EU law
European Parliament (EP) Plenary adopted on 13 September its opinion on the proposal amending Directive 2011/16/EU on administrative cooperation in the field of taxation (DAC 8). The report, prepared by MEP Rasmus Andresen (Greens/Germany), passed with 535 votes in favour, 57 votes against and 60 abstentions.
The Council already reached agreement on this file back in May. EP provided its opinion but has no legislative power to make changes to the proposal. Its opinion is nonetheless necessary in order for DAC 8 to become EU law.
OECD report provides comprehensive comparison of labour and capital taxes
OECD newly published working paper provides an analysis, comparing the tax treatment of labour and capital income across OECD countries, utilising stylised effective tax rates (ETRs). It shows that dividend income and capital gains are generally subject to lower ETRs than wage income at the personal level. In many countries, capital income is also tax-favoured even when considering taxes paid by both firms and individuals, although the gap between labour and capital income taxation tends to be smaller than when considering only personal-level taxes. The gap between ETRs on labour and capital income varies between countries and grows with income levels in some. The paper highlights that differential tax treatment of labour and capital income can affect the efficiency and equity of tax systems.
ERA Conference – Annual Conference on European VAT Law 2023
The program for the conference is available here.