Future Commissioners grilled by European Parliament
The European Parliament has held several hearings with Commissioner nominees before deciding on 23 October whether or not to approve the new Commission, led by Ursula von der Leyen.
During several of these hearings, MEPs grilled the nominees notably about taxation and the nominees, in return, elaborated on their priorities in this area.
Below are high-level overviews of the most tax-relevant hearings.
Gentiloni re-iterates his tax priorities
The future Commissioner for taxation, Paolo Gentiloni, confirmed during the hearing that his priorities would be CCTB, digital taxation and carbon taxes. He would also maintain the fight against tax evasion and avoidance high on the agenda.
Gentiloni specified on international tax reform that the EU would resume work on a unilateral digital tax solution in Q3 2020 if there is no OECD agreement by then.
In reply to a question from Ludek Niedermayer (EPP/Czech Republic), Gentiloni also re-iterated the importance of continuing VAT reforms in the upcoming term.
He further elaborates on his tax programme in his letter to MEPs.
Vestager to continue focus on tax state aid
In her letter to MEPs, the future Vice-President Margrethe Vestager (in charge of competition and digitalisation) announced her commitment to continue the tax state aid investigations that she has been leading on in the past term.
This means that the Commission will continue to question selective national tax rulings granted to multinationals, despite tax formally being a sovereignty area exclusive to the member states.
At her hearing with MEPs on 8 October, Vestager applauded the current Commission’s track record on tax, having passed 14 pieces of tax legislation since 2014.
However, she also highlighted that the Commission’s tax state aid investigations cannot solve problems in Europe’s tax system; this needs legislation. She specified, in particular, the need for public country by country reporting (CBCR), minimum taxation, C(C)CTB and removing unanimity in tax decision-making.
Dombrovskis underlines fight against tax avoidance and evasion
At his hearing on 8 October, future Vice-President Valdis Dombrovskis (finance) insisted on the need for tax fairness and promised to keep the fight against tax avoidance as a priority.
On tax havens, he stated that even higher standards should be applied in the EU than towards third countries. He also believes that the C(C)CTB would be helpful.
His letter to MEPs elaborates further on his tax and other priorities.
Timmermans wants green tax system
And finally, at his hearing with MEPs on 8 October future Vice-President Frans Timmermans (European Green Deal) underlined that tax measures are essential in the fight against climate change. Today, the wrong things are being taxed he declared.
Timmermans said that the carbon border tax is an area where the EU could lead by example. If third countries do not come along with EU on green measures, the EU will impose a carbon border tax that could be WTO compatible. However, this will have to be further looked into.
He also agreed with moving to qualified majority voting (QMV) in order to ensure that taxation helps in the green transition.
For a full list of Timmermans’ priorities, see his letter to MEPs.