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Moscovici 'Determined' To Usher In Common Corporate Tax Base

by Ulrika Lomas,, Brussels

22 June 2016

Pierre Moscovici, the EU Commissioner for Economic and Financial Affairs, Taxation, and Customs, said he is determined to see through the introduction of a common consolidated corporate tax base in the European Union.

The Commission has put forward a proposal to introduce the CCCTB in two stages. First, it hopes to establish a common tax base for calculating corporate tax. Second, it would look to push for unitary taxation of group companies, as though they were a single entity for tax purposes.

According to Moscovici, the CCCTB proposal would "remov[e] the main channels for multinational profit-shifting that exist in our Single Market today. All profits and losses will be consolidated, and shared amongst member states on the basis of assets, sales, and personnel."

Speaking at the Tax Congress of the Berlin Tax Forum 2016, on June 20, 2016, Moscovici explained that the intention is to even the playing field for all companies, whether they operate across borders.

"Businesses and investors need simplicity, certainty, and a level-playing field. They also need a swift and efficient system to solve double tax disputes, and the Commission will make proposal to improve the current situation by the end of this year. This will come together with the real prize for businesses: the Common Consolidated Corporate Tax Base, CCCTB, which the Commission will re-launch in the autumn," he said.

"[The CCCTB] will cut costs and administrative burdens for companies, who will no longer have to waste resources tackling transfer pricing or profit allocation issues. It will ensure greater legal certainty for businesses, who will no longer have to muddle through 28 different national systems, but will enjoy a single EU rulebook instead. It will remove two major complaints of cross-border companies, by eliminating double taxation for companies within the CCCTB and allowing them to enjoy cross-border offset. And, crucially, it will secure a playing field for all business that operate in our union."

Moscovici added: "I know that many businesses are concerned by our 'two step' approach - where consolidation will be postponed until the common base is secured. Let me reassure you on these concerns - the Commission has no intention of abandoning this aspect of the CCCTB. Once the common base is agreed, we will channel all our energies into securing the consolidation aspect of the CCCTB. We are well aware that this is what businesses are eagerly waiting for, and we will deliver it. I am not saying this will be easy, but I am determined to succeed."

TAGS: compliance | tax | investment | business | European Commission | tax compliance | tax avoidance | law | Organisation for Economic Co-operation and Development (OECD) | enforcement | tax authority | agreements | multinationals | legislation | tax planning | transfer pricing | G20 | tax reform | standards | regulation | legislation amendments | trade | European Union (EU) | Europe | BEPS

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