European Federation of Food, Agriculture and Tourism Trade Unions
Together for decent work and fair pay from farm to fork

EU Commission’s taxation plan: EFFAT welcomes first step against tax dumping but regrets lack of clear actions


Brussels, 18 June 2015 - The European Commission has published a new action plan titled A fairer corporate tax system in the EU. EFFAT welcomes the plan. However, further to its 'Unhappy Meal' report exposing transnational companies’ tax avoidance practices, EFFAT notices with regret that the Commission’s initiative lacks clear and punctual actions.

While stating that companies must pay taxes where they make profits and stop the fiscal race to the bottom, the Commission appears too timid especially in relation to country by country reporting, which appears to be further assessed or potentially introduced only in 2016, at the end of the public consultation that the Commission published today alongside the package. Country by country reporting could be introduced sooner, with the adoption of the revised Shareholders’ rights directive as adopted by the Legal Affairs Committee. 

Reacting to the action plan EFFAT:

• agrees that taxes need to be paid in the place where profits are generated

• claims that country-by country reporting needs to be made immediately mandatory 

• believes that fiscal harmonization of corporate tax in the EU would facilitate fair competition, based on the quality of products and on fair working condition and not on the tax regime

• calls on the EU institutions to adopt the revision of the shareholders’ rights directive as approved by the Legal Affairs Committee.

Commenting on the action plan, Harald Wiedenhofer, EFFAT Secretary General, said: “We welcome the Commission’s commitment to review the corporate tax framework as we strongly believe that profits should be taxed where they are generated. It is outrageous that some major transnational companies like McDonalds, Amazon, Ikea and Google, pay less than 1% taxes on huge profits. Choosing preferential regimes with no link to where the value is created requires urgent political attention and legislative action which need to start with mandatory reporting and a minimum corporate tax rate of 25% for multinational companies. After major scandals such as the LuxLeaks cases, I believe that institutions need to question the arguments around austerity, as the problem is mainly not about too high state expenditure but insufficient state revenue, due to tax evasion, tax avoidance, tax havens and a still missing finance transaction tax. The Commission’s decision to issue such plan today is a step in the right direction. However, we would have liked it to exploit the momentum sooner.’


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EFFAT is the European Federation of Food, Agriculture and Tourism Trade Unions. As a European Trade Union Federation representing 120 national trade unions from 35 European countries, EFFAT defends the interests of more than 22 million workers towards the European Institutions, European employers’ associations and transnational companies. EFFAT is a member of the ETUC and the European regional organisation of the IUF.