Commission Question – EU-wide corporation tax

Question for written answer E-009122/2015

to the Commission

Rule 130

Jonathan Arnott (EFDD)

Subject: EU-wide corporation tax

It has been reported that both Germany and France are keen on the harmonisation of corporation tax across the EU.

Given that Britain has the lowest rate of corporation tax in the G7, at 20 %, is the Commission aware of the significant difficulties that this would cause for the British economy?

Can the Commission please confirm its latest position and the status of any such proposals, whether formal or informal?

EN

E-009122/2015 Answer given on behalf of the Commission by Mr Moscovici (12.8.2015)

The Commission has no plans, formal or informal, to harmonise tax rates.

On June 17 2015, the Commission adopted a Communication on “A Fair and Efficient Corporate Tax System in the EU: 5 Key Areas for Action”1. The first area for action related to the Common Consolidated Corporate Tax Base (CCCTB), which offers a holistic solution to the problem of profit shifting in the EU. The CCCTB would eliminate the mismatches between tax systems which are exploited by aggressive tax planners and transfer pricing rules would no longer be used to shift profits. The CCCTB would deliver significant benefits to companies operating cross border in the EU, as they would only have to follow one set of tax rules, and would be able to offset profits made in one area with losses made in another. The Commission proposed a staged approach to the CCCTB. Member States should initially focus on elements relating to agreement at the OECD Base Erosion and Profit Shifting (BEPS) project, before moving on to other elements of the tax base and finally to consolidation. The international elements of the CCCTB are currently under discussion in Council, and the Commission is working on a new proposal.

A key point to note is that the CCCTB is aimed at aligning the tax base, which is to say the rules governing the calculation of taxable profits. Even upon adoption of the final stage, the CCCTB would not harmonise the tax rate which would remain the responsibility of Member States.

1 http://ec.europa.eu/taxation_customs/resources/documents/taxation/company_tax/fairer_corporate_taxation/com_2015_302_en.pdf

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