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S&Ds call on finance ministers to avoid delays to EU rules for corporate minimum tax rate

Date

15 Mar 2022

Sections

Euro & Finance

Following the OECD deal on a global minimum corporate tax rate, the EU must now ensure a rapid and ambitious implementation. EU ministers are expected to adopt an agreement tomorrow, but according to media reports they will postpone the implementation to December 2023.

The Socialists and Democrats are the driving force in the European Parliament for a minimum effective tax rate and tax justice. The Aurore Lalucq report setting out the European Parliament position on implementing the minimum corporate tax rate will be published this Wednesday. The report calls for more flexibility concerning the rate and the threshold, for a limit to the time for the carve-out, for a safeguard for the domestic top-up tax and for a review clause for a revision in five years.

Aurore Lalucq, S&D MEP and spokesperson on tax matters, and Parliament negotiator on the corporate minimum tax rate, said:

“We call on the EU finance ministers to agree on ambitious rules to make the corporate minimum effective tax rate a reality and do so quickly. Postponing the implementation to December 2023 is simply unacceptable. We must not waste any more time waiting for tax justice. Europe must lead by example.

“Of course, 15% is better than the 0% we currently have, but we call on the Council to be flexible for future more ambitious rates as well as on the threshold." 

Biljana Borzan, S&D MEP and vice-president for economic affairs, said:

“The agreement on a global minimum tax rate was historic. We now must make sure it becomes a game-changer to fix our broken tax system. Today, countries can aggressively fight with each other on tax dumping, while big companies and rich individuals shop around for the lowest rate. A 15% minimum tax rate is expected to yield €48 billion in additional, much-needed tax revenues. A domestic top-up would bring in billions more for the public purse. The new rules are also about fairness for hard-working people and the neighbourhood shops who pay their taxes.”

Note to the editor:

On 22 December 2021, the Commission proposed a directive ensuring a minimum effective tax rate for the global activities of large multinationals. The proposal follows up on the Organisation for Economic Co-operation and Development (OECD) 15% tax rate deal for multinationals with more than €750 million annual turnover. The European Parliament deals with the file under the consent procedure.

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