Answer given by Mr Gentiloni on behalf of the European Commission

6.2.2020

Fair and efficient taxation of the digital economy is a top priority for the Commission. A global agreement remains our preferred option, as this would bring stability in the global tax framework and avoid a multiplication of unilateral measures.

If no or limited agreement is reached at the level of the Organisation for Economic Cooperation and Development (OECD) by the end of 2020, the strong rational for EU action will remain and the EU should stand ready to act alone. The Commission would assess the different scenarios before proposing a way forward. The proposal would need to effectively capture digital business models, particularly those that can operate in a jurisdiction without a physical presence, and limit aggressive tax planning and excessive tax competition.

While the Commission will continue to support the work carried out at the OECD in order to reach a global consensus-based agreement on the reform of the corporate taxation framework, the EU and its Member States are sovereign over European digital taxation issues. In case of possible trade-related disputes, the Commission will support legal action within the framework of the World Trade Organisation (WTO). In case of unilateral trade action outside the WTO, the Commission stands ready to react robustly.

The Commission does not agree with the statement that one or some Member States qualify as a tax haven. Specific tax regimes are reviewed by the Code of Conduct for business taxation and can be subject to modification when found harmful. Moreover, as regards the EU Member States, tax rules that may be seen as facilitating aggressive tax planning are reviewed during the European Semester process and may entail a Country Specific Recommendation.