Place: Justus Lipsius building, Brussels
Chair: Jeroen Dijsselbloem, Minister for Finance of the Netherlands
All times are approximate and subject to change
+/- ttbc
Doorstep by Minister Dijsselbloem
+/- 08.00
Annual EIB governors' meeting
Roundtable
+/- 09.00
Ministerial breakfast
+/- 11.30
Beginning of Council meeting
Adoption of the agenda
Adoption of legislative A items (public session)
Anti-Tax Avoidance Package (public session)
AOB: Financial services (public session)
Adoption of non-legislative A items
Implementation of the Banking Union
VAT Action Plan
European Semester 2016
Any other business
At the end of the meeting
Press conference (live streaming)
+/- 15.00
Economic and Financial dialogue between the EU and the Western Balkans and Turkey
On 25 May 2016, the Council adopted rules on the reporting by multinational companies of tax-related information and exchange of that information between member states.
The directive is the first element of a January 2016 package of Commission proposals to strengthen rules against corporate tax avoidance. The directive builds on 2015 OECD recommendations to address tax base erosion and profit shifting (BEPS).
The directive will implement OECD anti-BEPS action 13, on country-by-country reporting by multinationals, into a legally binding EU instrument. It covers groups of companies with a total consolidated group revenue of at least €750 million.
The principal aim of the directive is to prevent multinationals from exploiting the technicalities of a tax system, or mismatches between different tax systems, in order to reduce or avoid their tax liabilities.
Information to be reported by multinationalsIncreasing transparency, the directive requires multinationals to report information -- detailed country-by-country -- on revenues, profits, taxes paid, capital, earnings, tangible assets and the number of employees.
This information must be reported, already for the 2016 fiscal year, to the tax authorities of the member state where the group's parent company is tax resident.
If the parent company is not EU tax resident and does not file a report, it must do so through its EU subsidiaries. Such "secondary reporting" will be optional for the 2016 fiscal year, but mandatory as from the 2017 fiscal year.
Information exchangeThe directive requires tax authorities to exchange these reports automatically, so that tax avoidance risks related to transfer pricing[1] can be assessed. For this, it builds on the EU's existing framework for automatic exchange between tax authorities, established by directive 2011/16/EU. An existing common communications network will be used, thereby saving implementation costs.
The directive sets deadlines of:
It also requires the member states to lay down rules on penalties applicable to infringements.
A common EU approachThe directive will ensure harmonised implementation in the EU of the OECD recommendation on country-by-country reporting.
The directive was adopted without discussion at a meeting of the Economic and Financial Council, following an agreement reached on 8 March 2016.
Other initiativesThe January 2016 anti-tax-avoidance package follows on from a number of EU initiatives in 2015. These include a directive, adopted in December 2015, on cross-border tax rulings.
In December 2014, the European Council cited “an urgent need to advance efforts in the fight against tax avoidance and aggressive tax planning, both at the global and EU levels”.
[1] Transfer pricing is the price paid for goods and services exchanged between entities that make up a corporate group.
The EU debate is a minefield, with half-truths and whole-lies coming from both camps. The reason for this, as I understand it, is twofold. Firstly, it is impossible to know what will happen in the event that the UK leaves the EU, or indeed what will happen in five, ten or fifty years’ time if we vote to stay on 23 June. Ergo, objective fact is largely off the table from the get-go. Secondly, the notion of ‘truth’ is tricky in ideological discussions. I recently saw Peter Hitchins make a brief intervention on the EU debate and was struck by his point that the signatories of the Irish Proclamation did not stand on the steps of the General Post Office with a detailed cost-benefit analysis of the impact on the economic forecasts and trade balance of the country. They held an ideological belief and made an impassioned political decision. By the same measure, the reason that ‘facts’ aren’t working as well in this referendum debate as some (myself included) might like, is because it is not a decision that can be based solely on fact. Moreover, in most cases, there genuinely are (at least) two answers to the question at hand. Untangling the accumulation of myths, misnomers and soundbites which permeate the referendum narrative is a job for someone more intelligent (not to mention more patient) than myself. However, in the spirit of ‘have blog, will air musings’, I draw attention here to one incident which has stuck in my mind (and which I noted down at the time) as emblematic of the problem with the EU referendum campaign.
On 3 March, BBC Radio 4’s Today programme conducted an interview with Conservative MP Bernard Jenkin, a member of the board of the Vote Leave campaign. Today presenter Mishal Husain put to Mr Jenkin that Sir Peter Ricketts, a recently-retired former ambassador, has raised concerns that if Britain were to leave the EU, France might cease to conduct border checks on those seeking entrance to the UK. Unusually for an MP on the Today programme, Mr Jenkin went on to directly address Sir Ricketts’ point with an equally valid counter-argument, but before he did, he made the following remarks:
‘Find me a diplomat that’s anti-EU…one of the reasons we’re in the mess we’re in is because we have diplomats who have religiously and slavishly pursued the European integration policy…they all have a certain view…it’s interesting, as soon as they retire they turn out to have this very pro-European view. I’m afraid I think it rather discredits the idea that we’ve got an impartial diplomatic service.’
In the interest of brevity, I will side-step the wealth of nonsense which Mr Jenkin managed to pack around his perfectly reasonable point that the French government is a rational and responsible body and is unlikely to severe all agreements with the UK overnight should we vote to leave. I will also by-pass the irony that I agreed with this central point, and yet he managed to present it and its contribution to his broader position in a way that was so infuriatingly exaggerated, misleading and childish that, in the end, it served only to convince me that I don’t want to be on any team that he is a part of. Instead, I draw attention to Mr Jenkin’s utterly bizarre string of logic which led him to conclude that, since British diplomats are commonly pro-EU, they must have been harbouring this dirty secret for many years and are somehow damaging British interests with their partiality.
I don’t have much difficulty accepting the premise of Mr Jenkin’s concern – it seems quite likely that many British diplomats (and, I imagine, diplomats from most other member states too) are pro-EU. What I find confusing is why he thinks that this is an innate characteristic, a preference which exists and pre-existed in British diplomats independent of their professional or personal experience, as if he suspects that they all went to a secret boarding school where they were drilled in the values of ‘ever closer union’ and prepared for infiltration into the UK’s diplomatic corps, only revealing their true, traitorous identities upon retirement. To my mind, the trend that Mr Jenkin identifies can best, if not only, be interpreted as follows: British diplomats (to accept Mr Jenkin’s premise that they all hold the same view as Sir Ricketts), having spent many years living in and working with the EU, have reached the conclusion that it is a project worthy of our support and participation. Possessing what is probably the most direct experience and expertise in the matter that it is possible to have, British diplomats consider the UK’s membership of the EU to be highly valuable and have chosen to voice this view in the context of the referendum campaign. Essentially, an expert group has presented its arguments for why the UK should vote ‘remain’.
This is an example of precisely the kind of rational contribution which should be being made in the referendum campaign. The view of Sir Ricketts and his colleagues, in light of their experience and expertise, carries value and voters should be exposed to it. This is not to say that it is wholly objective, of course it is not. British diplomats have particular experiences and, to that extent, their position is unavoidably biased. Furthermore, it would be impossible for me to say that I am certain that the argument they put forward is nothing but the unequivocal truth. These things are, incidentally, also true of any view aired by Mr Jenkin and his colleagues in the Vote Leave campaign, by those in the ‘remain’ camp, or by anyone else. However, by making his background known and ‘presenting his credentials’ to the British public, Sir Ricketts has made a valuable contribution which they can scrutinise and evaluate in the forming of their own judgements. Perhaps, rather than it being pro-EU campaigners who ‘lack confidence in this country’, as Mr Jenkin asserted later in his interview, it is those (on both sides of the issue) who exploit the inherently ideological nature of the referendum debate by framing informed opinion as inherent bias who lack confidence in British voters to decide for themselves.
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Having finally submitted my thesis and in light of the impending referendum, I digress in this post from health governance – please excuse the misleading platform.
The post Fact, ideology and logic in the EU referendum campaign appeared first on Ideas on Europe.
On 25 May 2016, the Council adopted a directive maintaining for a further two years the minimum standard VAT rate at 15%.
The minimum standard rate is aimed at preventing an excessive divergence in VAT rates applied by member states, and the structural imbalances or distortions of competition that could arise as a result. A minimum standard rate of 15% was applied until 31 December 2015.
In view of on-going discussions on definitive rules for a single European VAT area, the directive extends the minimum standard rate for a period long enough to ensure legal certainty. It maintains the rate at 15% from 1 January 2016 until 31 December 2017.
The directive was adopted without discussion at a meeting of the Economic and Financial Council.
EU Ministers of Foreign and European Affairs meet in Brussels on 24 May 2016 to prepare the June European Council and hold its annual rule of law dialogue.
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By Mehreen Khan
Read moreOn 25 May 2016 the Permanent Representatives Committee (Coreper) confirmed the deal reached with the European Parliament on the first rules to make public sector websites and mobile applications (apps) more accessible across the EU.
The draft directive requires EU countries to ensure that the websites and mobile apps of public sector bodies meet common European accessibility standards. In addition, people will be able to request specific information if content is inaccessible.
The new requirements will make content more accessible and usable for all users, and will especially benefit those with disabilities or age-related limitations.
What's next?Once the agreed text has undergone legal-linguistic finalisation, it needs to be formally approved first by the Council and then by the Parliament. The procedure is expected to be completed in the autumn.
For more information, please see our press release from 3 May 2016 (link below).