The EU continues to promote fair tax competition and address harmful tax practices, both within the EU and worldwide.
EU finance ministers
today agreed on a revised code of conduct for business taxation: a
political, intergovernmental commitment by member states to apply reinforced screening rules when looking for and remedy tax measures that could be harmful to the tax bases of other member states. The ultimate goal is to tackle harmful tax competition, tax evasion and tax avoidance in the EU.
While the international dimension of the work of the code of conduct
group is more widely known – the group is cooperating with third country
jurisdictions to promote and strengthen tax good governance and carries
out the work leading to the regular revision of the EU list of non-cooperative tax jurisdictions – the primary task of the code of conduct group has been to detect and eliminate harmful tax measures in EU member states since 1997.
Today’s revision of the code, the first one since 1997, means that member states will broaden the scope of the tax measures under scrutiny when examining harmful tax practices within the EU.
The update of the code took the form of a resolution of the Council and
of the representatives of the governments of the member states, meeting
within the Council, on a revised code of conduct for business taxation.
We confirmed today our commitment to a fairer tax environment
in the EU by reinforcing the rules we apply when tackling harmful tax
practices in an evolving economy. Our experts in taxation constantly
look out for harmful tax practices. Since starting its work in 1997, the
code of conduct group succeeded in eliminating around 140 harmful tax
practices within the EU. The code of conduct of business taxation has
not been amended since 1997 and today´s agreement further improves its
effectiveness also in the light of the recent international tax reform.
Zbyněk Stanjura, Minister of Finance of Czechia
The revised code of conduct introduces in particular the concept of
'tax features of general application'. Whereas previously only
preferential measures (such as special regimes or exemptions from the
general taxation system) were examined, under the new rules the scope
will also include tax features of general application. These will be
regarded as harmful if they lead to double non-taxation or the double/multiple use of tax benefits.
The revised code of conduct further clarifies the review process in
the code of conduct group, which is responsible for the administration
of the code.
This revision will allow the Council code of conduct working group to
continue its work to address harmful tax practices efficiently.
Background
The code of conduct is a political commitment that has an intergovernmental nature. The Council's code of conduct group consists of high-level taxation experts of the member states. It is responsible for monitoring possibly harmful tax measures in the EU member states.
European Commission
© Council of the European Union
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