Commission wants to harmonise corporate tax base across the EU

The Commission has adopted a comprehensive package on various EU taxation and customs policies in order to boost European competitiveness. The plan includes a number of existing proposals that are currently going through the decision-making processes, as well as a number of additional initiatives.
Some of the Commission's plans, however, are likely to meet with some reluctance, such as the proposal to harmonise the 25 different corporate tax systems in the EU in order to introduce one single tax base . The aim is to cut red tape for companies operating across European borders. This would, according to Kovacs, "be of considerable benefit to business and trade".
Kovacs expects strong opposition to the idea from a number of member states, including the UK, Ireland and Estonia. Slovakia has recently become more open to the idea, as it transpired that the Slovak flat tax system may well serve as a basis for the Commission's proposals.
"If we cannot reach a unanimous decision on this in the Council, some member states can still go ahead under the 'enhanced co-operation' procedure. I expect around 20 member states to join the scheme," said Kovacs. The corporate tax proposal is likely to be tabled in the second half of 2006.
Other Commission tax proposals will concern the modernisation of the Customs Code, the modernisation of VAT rules and a communication on R&D tax incentives.