EU Presidential debate hears call for minimum 18% corporation tax rate across the EU
A debate among the lead candidates for the presidency of the European Commission has heard a call for a minimum 18% corporation tax rate across the EU.
The call from the European Regulation Commissioner Frans Timmermans for the 18% minimum level would have serious implications for Ireland, where the corporation tax rate is currently is 12.5%.
The proposal was made in a live television debate from Brussels tonight which was screened for millions of people across Europe.
As the six candidates for the role of President of the European Commission made their pitch for one of top jobs in European politics, the European Competition Commissioner Margrethe Vestager also increased the pressure on Ireland by saying “We need to put a floor under corporate taxation as such, because otherwise, it will just be a race to the bottom.”
The Presidency of the Commission goes to the candidate of the political party capable of marshalling sufficient parliamentary support.
Six of those lead candidates went head to head in a live TV debate where issues discussed included the migrant crisis; youth unemployment, climate change, multi-national companies paying taxes and the rise of nationalism.
German journalist Markus Preiss, one of the three journalists hosting the debate asked: “Multinational corporations like Apple, Google or Nike are paying only marginal taxes of less than 5%, whereas we as ordinary citizens have to pay between 20 and 40%.”
He then asked the candidates which EU countries they view as “tax havens” and how can their behaviour be changed “to make sure that Amazon pays as much taxes as the bookseller next door?”
Ms Vestager, who is the lead candidate for the Alliance of Liberals and Democrats for Europe (ALDE) said the presenter was “very generous when he said that some only pay 5% because some pay 0.05% in some years as we saw within the Apple case”.
She acknowledged that taxation has been changed in Ireland, the Netherlands, Belgium, Malta and Cyprus “because change is coming”.
She stressed the need for digital taxation as a lot of these companies are escaping while most companies do pay their taxes and this is “unfair”.
Secondly she said: “We need to put a floor under corporate taxation as such, because otherwise, it will just be a race to the bottom.”
Greens lead candidate Ska Keller from Germany said “this is a real serious scandal we are having right now”.
She said that it is key that there is a tax justice, and there needs to be a tax rate for the big digital companies seeking to evade tax and “we need to have a minimum tax rate for companies”.
Asked if the Netherlands is a tax haven, Frans Timmermans, lead candidate for the European Socialists claimed: “They have seen the writing on the wall, that this does not work anymore and they are changing it.”
He added: “We need a minimum corporate tax level of 18% in the whole of Europe. Then you have a fair playing field. Countries can decide to do more but they cannot decide to do less.”
On the issue of Brexit, Mr Timmermans later said: “Look at what is happening in the UK now. Brexit make it looks like Game of Thrones on steroids.”