Today, 18/12/19, the plenary of the European Parliament voted on a resolution on digital taxation. Because tech companies such as Google, Apple and Facebook hardly pay any taxes on their profits, the EU Commission presented a proposal for a European digital tax in 2018. While the European Parliament supported this legislative initiative, several European governments, including the German government, prevented an ambitious decision in the Council. Until the end of 2020, the OECD is now looking for a solution at a global level. The resolution passed today by the EU parliament calls on the EU member states to speak with one voice in the OECD negotiations. Should the OECD negotiations fail, the EU Commission would have to present a new legislative proposal, ideally under the qualified majority procedure in accordance with Article 116 of the Treaty on the Functioning of the EU. For the first time, the MEPs of the European Christian Democrats also support the demand for a minimum tax rate for corporate taxation.
MEP Sven Giegold, financial and economic policy spokesperson of the Greens/EFA group commented:
“It is important that Europe speaks with one voice in the OECD negotiations. The objections from the United States show that an agreement at a global level is by no means certain. If multilateral efforts fail, the EU Commission must present a new proposal for Europe under the majority procedure. If ten out of 28 EU Member States levy their own digital tax or plan to do so, this clearly distorts competition in the internal market. We need a European response to the cross-border problem of low to zero taxation of digital value added.
For the first time, the Christian Democrats are also committed to minimum taxes. It is regrettable that Christian Democrats, right-wing conservatives and liberals rejected a concrete tax rate for corporate taxation, which Social Democrats, the Left and we Greens have called for. But, the fundamental commitment of the entire European Parliament to minimum taxes is an important signal in the fight against tax avoidance. It is time for all companies in the EU – large and small – to pay their fair share.
Europe is leading the way in curbing tax avoidance and fraud. To keep it that way, the weaknesses in the European Anti Tax Avoidance Directive (ATAD) must also be addressed. We are pleased that Christian Democrats, Social Democrats and the Left have supported our call for a review of the ATAD loopholes. Europe must not stand idly by and point to global negotiations as our new rules against tax dumping are undermined”.
Resolution of the European Parliament tabled for plenary vote:
https://www.europarl.europa.eu/doceo/document/B-9-2019-0238_EN.pdf
Overview of digital taxes levied or planned in the EU:
https://files.taxfoundation.org/20190717162806/DST-Countries-Final-01.png
