EU launches fresh assault on tax avoidance
European antitrust regulators are set to investigate whether corporate tax arrangements across the EU that allow companies to reduce their tax liability are anti-competitive.
European competition commissioner Joaquin Almunia outlined his concerns about such schemes in a speech this morning:
In those cases where national laws or tax-administration decisions permit or encourage these practices, there might be a state aid component involved and I intend to go to the bottom of it.
This is why in the last few months we have been sending requests for information to some Member States where we have doubts about the consistency of some aspects of their legal framework or of their administrative practices.
Last year, the G20 committed to the automatic exchange of information to establish a new global standard, with regard to tax avoidance.
However, the latest investigation into member states taxation policies could raise fears that the EU plans to interfere with legitimate tax competition and could ward off potential investment to member states.
The EU has so far preferred a policy of tax harmonisation to tax competition, with value-added taxes, energy taxes and excise taxes all being subject to some level of direct harmonisation.