EU to consider common tax regime proposals

New plans for further cross-border harmonisation of tax rules across the European Union are to be discussed by European finance ministers at a two-day meeting in Bratislava as Ireland finds itself increasingly isolated over the Apple tax decision.

Minister for Finance Michael Noonan arrived in the Slovak capital last night ahead of his first face-to-face meeting with EU finance ministers since last week's record finding by the European Commission that Ireland granted Apple €13 billion in illegal subsidies.

A discussion document prepared by Slovakia, which currently holds the rotating presidency of the EU, and seen by The Irish Times, sets out a number of proposals on tax which will be considered by ministers during a discussion scheduled for Saturday morning.

This includes a proposal for “further cross-border harmonisation of tax rules”, binding tax rulings and advance pricing agreements and a proposal to train tax administration officials to help them deal with “new global challenges” in the field of taxation.

Tax rules

The document states that while recent changes in international tax rules through the OECD process were “much-needed,” “coherent implementation of such measures in the form of hard law within the EU” eliminates uncertainty and possible double taxation resulting from different approaches adopted by different countries.

While Ireland is likely to oppose any measures that signal a transfer of tax competency to Brussels, other measures contained within the proposal will be welcomed by Dublin.

Also contained in the document is a consideration of “tax certainty” to ensure companies are not deterred from investing in the EU.

In a separate discussion today, ministers will also discuss granting greater fiscal powers to the EU, such as through a common investment fund, which could involve more surveillance of finance ministries.

Central bankers

Ireland is likely to strongly oppose any moves towards enhancing the EU’s oversight of fiscal matters, amid fears that it could intrude on the domain of taxation.

The meeting will also be attended by central bankers from across the euro zone, including Central Bank governor Philip Lane.

Taoiseach Enda Kenny secured assurances from European Council president Donald Tusk during a meeting yesterday that taxation will not be on the agenda at an EU leaders' meeting in Bratislava in a week's time, at which the EU will consider the future of Europe post-Brexit.

There is growing frustration in Brussels at the lack of detail from London about its plans for leaving the European Union, with Mr Tusk warning British prime minister Theresa May during a meeting in Downing Street that no negotiations would begin until article 50 is invoked.

“Some of the messages coming from the British government suggest a fundamental misunderstanding about how the single market works.

“You have to be a member of the EU’s single market with all the free movement obligations that goes with it, not simply have access to it,” said one senior EU source.

Meanwhile, MEPs have pushed for a debate on the Apple ruling next week in Strasbourg.