New European Parliament opinion on VAT in the digital age needed
European Commission
New European Commission sets administrative burden reduction as a priority
The new European Commission (EC) started to work on its new priorities as of 2 December.
One of the immediate actions of the new EC will be to deliver on the administrative burden reduction agenda, with first initiatives on this to be expected on 26 February 2025. In parallel, the EC continues its work to evaluate the functioning of the Directive on Administrative Cooperation (DAC) and the Anti-Tax Avoidance Directive (ATAD), and possible next steps for those should be announced in the course of 2025.
In the next weeks the new EC’s additional plans in the area of taxation should become clearer.
European Parliament
ECON Committee discusses Hungarian Presidency priorities and new opinion on ViDA
On 18 November, the European Parliament’s (EP) ECON Committee held its Economic Dialogue and exchange of views with Mihály Varga, ECOFIN President and Minister of Finance of Hungary. The focus was on the priorities of the Hungarian Presidency of the European Council.
After presenting the Presidency priorities, the Minister explained that in terms of the ECOFIN, the Hungarian Presidency is focused on the issues of competitiveness and how to increase economic growth. He pointed to the ongoing work on the fiscal framework as well as work on legislative files and the Capital Markets Union (CMU).
During the subsequent debate with MEPs, he was often asked about the situation in Hungary, notably in relation to corruption, as well as about the energy tax directive and the EU’s new fiscal rules.
The Minister also referred to the recent Council agreement on the VAT in the Digital Age (ViDA) proposals. He explained that since the Council’s final agreement differs significantly from the original EC proposal, the EP would be asked to provide a new non-binding opinion. The EP has already finalised an opinion on ViDA in the past, but that was on the basis of the EC’s proposal. As a result, there will be a delay before ViDA formally becomes EU law, as the EP’s opinion is needed before it can be published in the EU Official Journal.
International
ECA: EU fight against systemically harmful tax practices still not watertight
Strengthening the EU’s defense measures against harmful tax regimes and corporate tax avoidance has not closed all the gaps, according to a new report published by the European Court of Auditors (ECA) on 28 November.
The report examines the EU efforts to combat harmful tax regimes and corporate tax avoidance. Within its limited competences in the area of direct taxation, the EU adopted a legal framework and uses supporting instruments as a first line of defense against systemic harmful tax practices.
However, ECA identified shortcomings in how the rules were implemented and noted the absence of a common performance monitoring framework at EU and national level. ECA recommends ways to improve EC’s oversight and close existing loopholes, thus helping it to tackle these harmful tax practices, and provide enhanced support to member states to ensure consistent application of the legislation.
