On September 9 and September 10 an informal meeting of the Economic and Financial Affairs Ministers of the European Union (ECOFIN) will be held. The meeting will be chaired by the Czech Presidency. On September 6, 2019 the Dutch Minister of Finance sent some documents in this respect to the Dutch House of Representatives. One of this documents is a so-called Presidency Issues Note titled: “Harmonisation in the area of direct taxation within the EU: where do we stand and what is the most efficient way forward?”
The Presidency asks for the Member States' position on developments in the area of direct taxation. The presidency also asks whether the use of soft law, like for example through non-legally binding recommendations or rules of conduct, can be an instrument to accelerate decision-making on tax issues. In this regard, the Presidency's Issues Note mentions the deadlock surrounding the implementation of the legislation on the effective minimum tax rate (also referred to as Pillar 2).
Without giving concrete examples the presidency states that it hopes that the internal market can be improved by the use of soft law. The Dutch Minister states that Netherlands is interested in finding out where soft law could lead to faster decision-making. It is important that a level playing field is a necessary condition for the internal market. In contrast to hard law (in the form of guidelines and supervision by the Commission on the interpretation), soft law offers Member States more room for their own interpretation. In the field of anti-abuse measures, for example, according to the Dutch Minister it remains to be seen whether soft law can offer the same uniformity and thus an efficient approach in comparison to hard law.
The Presidency Issues Note titled: “Harmonisation in the area of direct taxation within the EU: where do we stand and what is the most efficient way forward?” as published on the website of the Dutch Ministry of Finance you can download here.
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