Brussels – Economic and Financial Affairs Council of the European Union (EU) reached an agreement on Tuesday – during its meeting in Brussels – on a Council directive aimed at preventing multinationals from lowering their overall tax liability by taking advantage of differences in tax laws, involving non-EU countries. This is the latest of a number of EU measures designed to prevent tax avoidance by large multinationals.
The council aims to counteract hybrid mismatch arrangements in a holistic and comprehensive way to avoid inefficiencies and distortions caused by the interaction of different national tax measures, which also means the implementation of the 2015 OECD/G20 BEPS recommendations.
“The EU is at the forefront of the fight against tax avoidance. We want to ensure coherent implementation in EU law of the OECD’s action plan,” Minister for Finance of Malta and President of the Council Edward Scicluna, said, announcing the agreement.
Regarding implementation, Member States must adopt and publish, by 31 December 2019, laws, regulations, and administrative provisions necessary to comply with the directive. Implementation is set for 1 January 2020.
These statements came in a press conference following the first meeting by the Council.
Jeroen Dijsselbloem, head of Eurogroup of finance ministers said that the meeting discussed facilitating financial activities in the Eurozone – some ministers proposed creating business friendly environment in their countries, as part of the efforts made to enhance the investments. Discussions are set to resume in April, the Eurozone’s chief stated.
During the meeting, the Eurogroup exchanged views on the economic situation in the euro area, following the European Commission’s presentation of its winter 2017 economic forecast. Dijsselbloem noted that the Gross Domestic Product (GDP) grew by 1.7% in 2016, amid many positive indications from different member states and drop of unemployment rate in most European countries.