(September 12, 2015)

On September 11 and 12, 2015 an informal meeting of the EU Ministers of Finance and Economy (ECOFIN) took place. “Minimum effective level of taxation” was one of the items on the Agenda. This subject was discussed during a session that took place in the afternoon of September 11. During this session the participants exchanged views on the way forward with regard to the minimum effective level of taxation in the EU and in relation to third countries on the basis of a Presidency Issues note.

The European Commission published the speech delivered/the remarks made by EU Commissioner Moscovici during the press release at the end of the sessions that took place on September 11. With respect to the subject of “Minimum effective level of taxation” the publication as available on the website of the European Commission states the following:

“Now, a few words on our discussion this afternoon on effective taxation.

This was a very useful and also a very necessary exchange of views on how to ensure that companies that generate their profits in the EU pay their fair share of tax here in the EU.

This issue will be very familiar to you by now.

The central focus of our debate today was on the question of effective taxation. We are all aware that certain multinationals pay little or no tax on the vast profits they make here in Europe. This is absolutely unacceptable.

That’s why we need to ensure that profits generated in the EU are taxed at an appropriate level where the activity takes place.

That does not mean, in the view of the Commission, harmonising minimum tax rates. It means agreeing on the principle that everyone should pay their fair share.

Because in the end, it's other businesses – and SMEs in particular – and ordinary citizens, who have to pay the price of this tax avoidance, either through higher taxes and or public spending cuts. We need to have strong public services and we need to have tax fairness in our countries.

Since taking office last November, this Commission has made it a priority to achieve fair and effective corporate taxation in the EU.

In March, first, I presented a simple, common sense proposal for the automatic exchange of information on tax rulings, which I firmly believe needs to be adopted now. There is an agreement between the Presidency, the Council and the Commission that we should try to find a deal, a consensus at the next ECOFIN meeting on 6th October. Second that we need to implement this agreement if reached in a very short period because we need to be online with the OECD, which plans to achieve its works on this by the end of first quarter 2016. And third, we need to have an ambitious mechanism and I insist on the fact that the Commission must be a player in the game. I had the occasion to meet the Prime Minister Xavier Bettel and we agreed that the question is here to have a level-playing field with all countries in this respect. Europeans expect us to deliver on our commitment to greater tax transparency and they have every right to do so.

Then in June, I set out an ambitious Action Plan on Corporate Taxation. It is hard to argue against the fundamental principles of the plan, but of course there has been a lot of discussion about how we get there.

I won't pretend that there is full consensus amongst Member States on how we define effective taxation, nor on how we achieve it.

Nonetheless, I welcome the fact that Ministers agree that effective taxation must lie at the heart of EU tax policy from now on. This, in itself, is major progress.

Now we need to get down to work and deliver. I urge all of my colleagues here today to maintain the political momentum we need to deliver real results that will benefit all Europeans.”

Click here to be forwarded to the full text of the speech delivered/remarks made by EU Commissioner Moscovici as available on the website of the European Commission.

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