INI report on "Further Reform of Corporate Taxation Rules"
On 27 June 2023, the rapporteur for the own-initiative report on "Further Reform of Corporate Taxation Rules" will present and discuss her draft report with other FISC Members. In October 2021, the OECD/G20 Inclusive Framework on BEPS reached a landmark agreement on a comprehensive two-pillar reform of global tax rules. This reform, which has been endorsed by 138 out of 141 members of the Inclusive Framework, introduces a global minimum effective corporate tax rate of 15% as well as new rules.
These new rules would make possible to tax profits of very large multinational companies in countries where they do not have a physical presence. Against this background, the FISC Subcommittee has looked at the remaining challenges in the area of corporate income tax in the framework of public hearings, exchanges of views and studies.
The draft report highlights the compliance costs imposed on businesses due to existing EU tax legislation. The rapporteur suggests various measures to ease this burden, including a regulatory moratorium and a 'competitiveness check' on new measures proposed by the Commission. The draft report further suggests that tax breaks and other incentives should be considered to support the competitiveness of European businesses. Finally, the rapporteur calls on the Commission to sequence the implementation of the upcoming BEFIT proposal and Pillar 2 of the OECD's tax reform to provide European businesses sufficient time to prepare for the regulatory changes.