The FINANCIAL — EU member states must be more transparent about their national tax rulings, because unfair tax competition distorts competition among companies and could lead to a “race to the bottom”, warned many MEPs in debate with taxation Commissioner Pierre Moscovici on March 25.
Mr Moscovici – who defended his recent proposal for the automatic exchange of tax rulings among EU member states – shared many of the MEPs’ concerns and acknowledged that the differences in national tax rules lead to a fragmentation of the EU single market. He advocated better coordination of member states’ tax policies and announced that he would present an analysis of the tax situation across Europe before the end of 2015, as a basis for further work on tax issues.
Many MEPs argued that taxes should be paid where profits are made and some insisted there should be a common consolidated corporate tax base (CCCTB) to even out the differences. Advantageous tax deals for big, multinational firms were considered unfair towards citizens and small and medium-sized enterprises which have to foot the bulk of the tax bill to fund public expenditure.
The European Commission was also urged to put the case for tax transparency to third countries, in international fora.
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