25 June 2019
We need more ambition to make European taxation fairer and more efficient

We need more ambition to make European taxation fairer and more efficient

€825 billion are lost every year because of tax evasion and fraud in the European Union, which translates into a loss of €1.600 per EU citizen. This means fewer resources for public investments in education, health, housing and the fight against the climate crisis (just to name a few). Taxation is an important issue. However, it remains one of the few domains in which the EU Member States are still making decisions or rejecting matters unanimously. This could seem at first sight as a mere institutional issue; it has nevertheless an impact on peopleʼs lives. Getting rid in the Council of the European Union of the unanimity requirement for tax issues would ensure that no Member State could veto new important decisions linking European taxation to the fight against inequality. At a second level, this would also mean that the climate crisis could be finally dealt with at a European level.

Christophe Rouillon, acting President of the PES Group, Mayor of Coulaines (France) and rapporteur of the European Committee of the Regions on this issue, explains: “Taxation should not become the weakest link of the European integration. Unanimity voting for tax matters has made any kind of reform impossible, despite the latest technological developments, market changes and the more mobile tax base. Member States should understand that a joint European approach allows for more tax revenues and more fiscal fairness than all of the combined national tax sovereignties and the loopholes that this system encompasses.  The public opinion is very much in favor of a more ambitious EU tax policy. The European Committee of the Regions would, however, appreciate if the environmental taxation (and in particular taxation in the aviation sector) was included in the priority issues that are moving forward and which could offer a great potential for possible EU resources”.

 

 

As some Member States are still tax havens and thus create a tax race to the bottom, we believe that it should be a priority for the European institutions to start acting on this issue to make tax policy more efficient and more democratic.

“Joint efforts at European and national levels are necessary to ensure fair tax competition, reduce the administrative burden for companies working across borders as well as to safeguard public budgets from losses due to tax evasion. Only tax revenues that are fully and effectively collected will allow us, as local and regional authorities, to provide our citizens with quality public services, whether it is in education, health, affordable housing or public transport,” argues Rouillon.

In another text presented during the European Committee of the Regions' plenary session on the future of Europe, the PES Group called for the expansion of the removal of the unanimity rules beyond tax policies, including in the social policy, the Economic and Monetary Union, and the 2030 climate and energy framework.

Progressive cities and regions want to see reforms happen to make sure that the European Union has sufficient resources to pursue the Sustainable Development Goals agenda and to build a more just and more sustainable Europe.

 

 

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Photo by Ibrahim Rifath on Unsplash

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