Contrary to gung-ho reports in UK press (Daily Express, 27 May, Fury at EU plot to tax Britain; Daily Telegraph, France and Germany behind plans for ‘common EU corporation tax’), claims that the European Commission is planning to propose a minimum rate of taxation for businesses in the EU are plain wrong.
What we do however want to ensure is effective and fair taxation of profits where they are generated, especially when it comes to companies that do business across borders. Discussions at EU level are about tax bases and making sure companies cannot unfairly escape payment or derive unfair advantages from moving profits around, not about tax rates.
A tax base is not the rate of tax or the sum levied in tax but the value of the income or assets on which tax is calculated.
Here are some details about what the EU is really doing and intends to do. We would also take this opportunity to reiterate that all proposals in the area of taxation must be approved unanimously by member states. In other words, the UK – and everyone else – has a veto.