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S&Ds call to abandon unanimity in tax issues as finance ministers fail to adopt Code of Conduct reform

Date

07 Dec 2021

Sections

Euro & Finance

Reacting to the failure of finance ministers to adopt a much needed reform of the seriously out-dated 1997 Code of Conduct for business taxation at today’s Council meeting, due to the blockage by some countries, the Socialists and Democrats reiterate their call to abandon unanimity voting on tax issues. The Code of Conduct is the EU’s main tool to combat tax evasion and avoidance.

The Socialists and Democrats led the drive for the reform of the Code of Conduct and won the backing of the European Parliament for an S&D report with concrete reform proposals in October of this year.

Aurore Lalucq, S&D MEP, author on the report on reforming the Code of Conduct and spokesperson on tax matters, said:

“I am deeply disappointed by the failure of finance ministers today to adopt the much needed reform of the Code of Conduct for business taxation. The Pandora Papers again unveiled the industrial scale of the tax abuse big multinational corporations and rich individuals engage in, depriving Europeans of much needed funds. The Code of Conduct is the EU’s main tool to address such tax crimes, yet it dates back to 1997 and simply is no longer up to current challenges linked to digitalisation and globalisation.  To give but one example: some of the world’s most notorious tax havens, like Switzerland, the Netherlands, Hong Kong or Jersey, do not even make it onto the European blacklist of tax havens.  Realistic and strict criteria, such as a minimum effective tax rate and a minimum level of economic substance, as well as tough sanctions for tax havens, are among the reforms the European Parliament backed in my report.”

Jonás Fernandez, S&D MEP and spokesperson for economic and monetary matters, said:

“For all those engaged in the fight for tax justice, it is bad news that EU ministers today were not able to adopt the much needed reform of code of conduct for business taxation. It is a scandal that again a very small minority of unwilling countries were able to block an overwhelming majority of willing countries from making progress. Three out of four Europeans expect the EU to crack down on tax abuse and tax crimes. It is time their voices are heard and tax matters are decided by majority voting, just as in other policy fields."

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