Polish Prime Minister Mateusz Morawiecki declared yesterday that there should be no tax havens in Europe and that, if there is no common EU digital tax, member states will have to act alone.
"The European Commission itself and the OECD consider some countries, like Cyprus and Malta - but lately even Belgium or Ireland, as countries which help multinational giants to avoid paying tax," Morawiecki said.
Morawiecki said that Poland was one of the countries bringing up the topic of a common digital tax at meetings of the European Council and that Warsaw was in touch often with France and Germany about the issue.
Morawiecki said that, according to his sources, Austria was getting ready to introduce a digital tax despite the lack of EU consensus.
"We want to do it together with all EU countries, but the Austrian example shows that, if there is no consensus, member countries will have to take this decision - I hope, not long from now - on their own, independently and with responsibility," Morawiecki added.
Last year, the European Commission proposed an EU tax on big digital firms' online revenues, arguing that companies funnelled profits through states with the lowest corporate tax levels.
The idea was met with resistance by several EU member states, including Malta, leading France and Germany to propose a watered-down version at the end of last year.
The Commission’s digital advertising tax proposal was rejected by the finance ministers at last Wednesday’s ECOFIN meeting, on the basis that there should be global agreement on such a tax, in order to protect the EU’s competitiveness.
The arguments for this rejection focused mainly on the discussions at OECD level, which highlights the importance of having a global agreement for such a tax, rather than solely a European initiative.
The ECOFIN ministers had agreed that discussion on the digital services tax would be discussed by the Council should international initiatives for reaching a global agreement fail.
Malta’s Finance Minister Edward Scicluna said that Malta would not object on condition that this tax did not become effective prior to 1 January, 2022, by when it hoped that a global solution would be found.
“Changes to production and consumption patterns due to digitisation may require a review of the current tax systems to avoid eroding the tax-base. But this change cannot be undertaken unilaterally,” he stressed.
At the meeting, the ministers approved a revised list of non-cooperative tax jurisdictions which now also includes jurisdictions which are still deemed to be non-cooperative on tax matters, while others were removed after having acted on the initial concerns.