was also in the Global Tax 50
As one of the most important agenda-setters for EU tax
policy, European Commissioner Pierre Moscovici has made it into
this year's Global Tax 50 after one year of absence. Moscovici
oversees tax policy in his role on the European Commission. He
speaks to International Tax Review about the
achievements of the past year and what lies ahead in 2018.
A key part of the Juncker Commission's focus has been the
challenges of tax avoidance and how to tackle this threat to
the budgets of national governments across the EU, one major
initiative being the common consolidated corporate tax base
(CCCTB). When it comes to such matters, Moscovici is optimistic
about the prospects for the coming year.
"The public debate around fairer taxation means that we now
have a real chance to make lasting changes. We must seize that
chance," Moscovici says. "We've already done a lot, but for
2018 I see three major avenues for progress."
"First, I want to see an EU level agreement on our proposal
for new transparency rules for advisers and intermediaries who
help to put in place tax avoidance structures," he says. "We
will be keeping up the pressure on EU countries to adopt the
CCCTB. True reform of how corporate tax works in the EU is
needed to solve the problem of cross-border tax avoidance once
and for all, to the benefit of all Europeans."
"The Panama and Paradise Papers and tales of large-scale tax
avoidance by big companies have brought much greater public
attention to the ways in which tax avoidance and tax evasion
have been able to infiltrate our tax systems on such a grand
scale," he adds.
The Commission plays a key role in supporting the proposals
adopted by the European Council. Most recently, it compiled a
list of 17 uncooperative tax jurisdictions and a separate grey
list. The idea is that these lists will be updated on an annual
basis, but these lists have been criticised by anti-tax
avoidance campaigners for not going far enough in singling out
These efforts complement the EU's Anti-Tax Avoidance
Directive (ATAD). The ATAD carries strong measures for a common
strategy to counter tax avoidance. "I'm confident that once the
new rules have kicked in, we will see strong results and higher
revenues for the coffers of member states," Moscovici says.
Taxing the digital economy
Beyond tackling tax avoidance, the European Commission is
watching the burgeoning online economy closely and looking to
establish a digital tax framework. As part of this project, the
EU and the OECD have both opened their own consultation process
on how online business should be taxed. This could be the
starting point for major policy initiatives in 2018.
"The digital economy is an industry that mainly deals with
intangible assets and does not recognise borders. That is why
we are actively contributing to the global work on this at the
OECD to try to achieve international solutions," Moscovici
says. "I'm looking forward to seeing the fruits of that work.
But the EU must have specific and targeted solutions that suit
and protect our single market."
"All options are being examined so that we can deliver those
solutions in early 2018," he continues. "I'm optimistic that we
can quickly move ahead on this so that in the future, digital
giants will contribute appropriately to the public finances of
the countries in which they earn their profits."
The difficulty for the EU is the plethora of different
business models used by online companies. The European
Commission has identified at least four archetypes, such as
online retail, social media, subscription and collaborative
platforms. There are also companies that are hybrids of these
Some European countries are already exploring options on
this front. For instance Germany, France, Italy and Spain have
come out in support of an equalisation tax, which would amount
to a special levy on the turnover of digital companies. But the
Juncker Commission is keen to avoid unilateral actions that may
make it harder to find a common solution.
Moscovici has made it clear that the Commission wants to
establish a level playing field for companies, but this still
leaves the question of how this should be achieved. This
includes the CCCTB, which would create the framework for
revising the rules around permanent establishments.
"At the most basic level, it simply makes sense for big
companies to have an easier and cheaper way to calculate their
taxes in the EU, in turn making it easier and cheaper for them
to operate cross-border," Moscovici says. "A stable tax
environment, attractive schemes for R&D and the raising of
equity complete the picture of the benefits this reform would
bring for multinationals."