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Fresh fears over plan to give EU more control over company tax

The EU Commission has conceded it cannot say how much multi-national tax revenue Ireland would lose under a proposal to give Brussels more control over big company taxes.
After a series of tax avoidance scandals associated with the multinationals, which has heaped pressure for change on Ireland, the policy-guiding commission has redoubled efforts to get approval for a so-called common consolidated corporate tax base (CCCTB).
This is a single set of EU-wide rules to calculate companies’ taxable profits. But confusion has persisted about the actual impact of this scheme, which the commission argues would diminish the multinationals’ power to play one tax jurisdiction off against another.

EU Tax Commissioner Pierre Moscovici has now told Dublin Fine Gael MEP Brian Hayes that he cannot give a full country-by-country breakdown of revenue losses arising from the single set of company tax rules.
Commissioner Moscovici had previously said the Irish Government stood to lose just 0.2pc of tax revenue – but the Irish business lobby group Ibec is predicting a 7.7pc loss, which would leave a sizable hole in State coffers. Now, in a letter to Mr Hayes, the commissioner said it is not possible for Brussels to gauge detailed potential losses at this point.

Mr Hayes has said the problem points up the urgent need for a public study on the full impact of CCCTB. “It is extremely confusing for Irish people to get two drastically different estimates about the impact of this major proposal on our tax revenues. While the commission is of course on a charm offensive to sell CCCTB, we have to ensure that there is no misleading data,” Mr Hayes told the Irish Independent.
Commissioner Moscovici has defended his stance on the issue, pointing out that his team has published the outcome of all studies it had undertaken.

He said it did not have all the details required to do a detailed projection of the impact on individual member states and argued that this was a job for national governments.

“Despite our repeated calls for all the member states to undertake national impact assessments in order to allow an informed discussion of the possible similarities and dissimilarities, no member state has so far been able or willing to carry out such impact assessment,” Mr Moscovici told Mr Hayes.

The commissioner said he had not received full details of the Ibec study and was reliant only on press reports about it.

He said he had been told that the Ibec details were confidential.

The EU Commission relaunched its CCCTB proposal in 2016 but it goes back to 2001 and requires unanimous approval of all member states. There are fears the departure of Britain from the EU will dilute opposition, with Ireland now reliant on five other much smaller member states for support in opposing it. The Irish Government fears that it will lose multinational tax revenue, which would be more widely spread among other member states. It would not, at this stage, impact on the 12.5pc tax rate which has caused widespread resentment in the bigger EU countries.
The Irish Government has steadfastly rejected the principle that the EU can have a say in individual member states’ taxation decisions. It insists this is for national governments.

Article Source: http://tinyurl.com/kbwqb42


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