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Digital taxation
Finance ministers had an exchange of views on tax challenges arising from digitalisation. They took stock of the progress achieved in the context of the OECD, both on the reallocation of profits of digitalized businesses ("Pillar 1") and on the general reform of international corporate taxation ("Pillar 2).
The OECD has been working intensively in the past months with a view to agreeing on the architecture of a global solution at its meeting on 29-30 January 2020.
The debate confirmed that an international solution on digital taxation was the best way forward, as it would prevent fragmentation and unilateral measures. Ministers acknowledged that the OECD was working against a tight deadline to reach a global consensus by the end of 2020, and many highlighted the importance of making good use of the current political momentum.
The presidency concluded that it would continue attending international meetings on this issue. It will organise technical discussions in the Council in order to prepare, as far as possible, negotiations taking place at the OECD and address member states' concerns.
European Green Deal
Ministers discussed the financial and economic aspects of the European Green Deal. The Commission presented its communication on the Sustainable Europe Investment Plan published on 14 January.
The plan aims to mobilise at least EUR 1 trillion of investments over the coming decade. The Commission proposes to achieve this by drawing on EU's budget, through a "Just Transition Fund", as well as bringing in private funding by leveraging guarantees under the InvestEU programme. The plan also foresees a greater role for the EIB in financing sustainable projects.
During the debate, ministers stressed the importance and relevance of the European Green Deal and their readiness to examine, as a matter of priority, the concrete actions to be put forward by the Commission under the deal in the months to come.
European Semester
The Council initiated the annual 'European Semester' process for the monitoring of the member states' economic, employment and fiscal policies.
The Commission presented its Autumn package published on 17 December 2019, including:
European Commission: Opening remarks of Executive Vice-President Valdis Dombrovskis at the ECOFIN press conference
Mr Dombrovskis said: “As you know, this is our comprehensive funding plan to make the Green Deal a reality.
Why do we need it? To meet only the current 2030 climate and energy targets, it is estimated that we need an additional €260 billion of additional annual investment.
We plan to mobilise both public and private funds to generate at least €1 trillion in sustainable investments. That means using the EU budget, and also, using new rules and some regulatory incentives to spur green investments, both from Member States and private sectors.
Today we heard strong support and commitment from finance ministers to take ownership of the green transition. We share the view that each country has its own challenges and different starting points. The Commission will take these points into account in its work.
It is also clear that private capital will have to cover the biggest share of transition costs.
This is why one of my top priorities is to drive forward our sustainable finance agenda and bring private investors on board.
Co-legislators recently agreed on the classification – or taxonomy - for green investments. Once implemented, this will give the private sector the tool it needs to identify what is green. We will explore how this taxonomy can also be used the public sector.”
Full speech on European Commission