The EU finance ministers have not been able to find, even this time, an agreement on the minimum global tax of 15% for multinationals. The process was blocked by Poland’s veto, the only State still opposed after the French presidency of the EU, with the help of the Commission, was able to incorporate the observations of the other countries that at the last Ecofin meeting, three weeks ago, had said they were against. Among them, Sweden, Estonia and Malta.
The directive seeks to transfer one of the two pillars agreed last year by the OECD to EU legislation to create an effective minimum tax of 15% on companies with annual revenues exceeding 750 million euros, but leaves the other pillar of the pact aside. , the tax on tech giants (digital tax).
At the Ecofin meeting in Luxembourg, Warsaw is the only capital that said it was against. This is because he would like, at least according to what Undersecretary Magdalena Rzeczkowska explained, for the EU to transpose the two pillars of the OECD agreement simultaneously.
The hope, also expressed by the Vice President of the European Commission, Valdis Dombrovskis, is that an agreement can be reached at the next Ecofin meeting, scheduled for May 24th. The Commissioner for the Economy, Paolo Gentiloni, called it a good compromise and invited reluctant countries to accept it. Economy Minister Daniele Franco, on the other hand, judged it “a success that cannot be wasted”.
In an attempt to meet Polish demands, France has proposed to insert a declaration signed by the Twenty-Seven which reaffirms the commitment to continue the digital tax as soon as the provision is finalized within the OECDbut for Warsaw it is not enough.
“The bond is not legally binding to ensure they come into effect at the same time,” said Rzeczkowska.
For his part, the French Minister of Finance, Bruno Le Maire, explained that it is “impossible” to fulfill the legal constraint required by Poland since the minimum rate depends on a European directive, while the taxation of digital businesses will be governed by an international treaty. .
He hinted that there must be “another reason” for the Polish veto. It is difficult not to think that Warsaw uses its veto as a lever to obtain the approval of its National Recovery and Resilience Plan, still blocked by the Commission and whose judgment passes right on the Ecofin table.
When asked about this in plenary, the president of the Commission, Ursula von der Leyen, however, clarified that the approval of the Polish Recovery is still a long way off. Three weeks ago there were at least four states opposed to the directive but they were for technical reasons that have been corrected, as Le Maire stressed several times today, who would like to see the agreement approved within the French presidency semester which expires on 30 June.
For example, Estonia had reservations about the so-called income inclusion rule, which allows the profits of a subsidiary abroad to be taxed if it pays a corporate tax rate below the minimum. The text received today at the table of ministers provided for the voluntary application of this clause for a period of six years (it was five).
Another obstacle was the date of entry into force of the directive, originally scheduled for 1 January 2023, but postponed to the “end” of 2023 after the comments of the Swedish delegation. Malta, on the other hand, complained about the technical difficulties in transposing the directive. The Commission therefore offered its assistance in persuading it to give the green light.