Commission hosts conference to debate future strategy for company taxation

At the end of April, the Commission is inviting tax experts, national officials, and other stakeholders to debate its Communication on a strategy for a consolidated corporate tax base for companies operating in the EU.

On 29 and 30 April, the Commission will host a conference to debate the options presented in the Communication. Essentially, these include:

 

  • Home State Taxation – where a multinational group would be allowed to calculate the taxable profits for all its EU operations according to the the tax rules of the Member State where its headquarters are based, and
  • a Common (Consolidated) Tax Base – where a multinational group would be able to calculate the taxable profits for all its EU operations according to a new common set of tax rules applicable across the EU.

The conference will bring together tax specialists, national and EU officials, business and trade union representatives, and academics. Participants will be invited to debate the issues in three steps: the first session will examine the need for corporate tax reform (in total, the Commission is suggesting four options). The second session will look at which approach would be preferable for EU companies and the third will explore the means for achieving a common tax base.

To prepare the conference, the Commission has launched a web-site which gives the agenda, the names of the panelists, background materials and provide an on-line discussion forum.

 

In a Communication published in October 2001, the Commission argued that the EU must agree a strategy to allow companies, in the longer term, to use a single consolidated base (but not harmonised rates) for computing tax on their EU-wide profits. Its own studies into this issue have confirmed that the current tax rules (different in each Member State) create compliance costs and cause problems related to transfer pricing, double taxation and the absence of relief for losses on cross border transactions. In the short term, the Communication identified several steps that could be taken to remove specific tax obstacles to cross-border trade.

 

The Commission will take into account the views expressed at the conference, as well as all written submissions it receives, in a report that it has undertaken to complete by 2003. This report will not contain policy conclusions.

 

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