By Chris Jones - 25th October 2005
CORRECTION: Brussels is to push ahead with plans for a common measure for European corporate taxes despite opposition from several member states.
European Taxation and Customs Commissioner Lazlo Kovacs said that five countries had reservations about the scheme, designed to cut red tape and make it easier for companies to operate throughout the EU.
But he said that the system could be rolled out in the other 20 European countries within four years.
“This would still mean a much simpler system for European countries, with just six regimes – one unified system for 20 countries, plus the other five – rather than the 25 different ones at present.”
Britain and Ireland have opposed the proposal on the grounds that all taxation issues should remain outside the commission’s remit.
The other three countries – the Czech Republic, Estonia and Slovakia – all have low corporate taxes and are concerned that a unified scheme for calculating the basis of different EU taxes would lead to pressure to increase rates.
A unified system of calculating the base of the EU’s corporate taxes would allow comparisons to be made and could fuel claims of ‘social dumping’ against countries with low rates.
The move is part of a broader strategy by Kovacs to simplify and improve customs and taxations systems across the EU in order to stimulate growth.
He has already unveiled plans to crack down on counterfeiting and introduce a more unified approach to car taxation.
Other measures planned for next year include guidelines on tax incentives for research and development and on VAT on financial services.
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