On 8 June 2018, the European Commission presented a proposal for a Regulation establishing the 'Fiscalis' programme for cooperation in the field of taxation as part of the Multiannual Financial Framework (MFF) for the years 2021-2027. The proposal aims to replace Fiscalis 2020 programme (Regulation 1286/2013).

The proposal for the new ‘Fiscalis’ programme  provides mechanisms, means as well as the necessary funding aiming to support tax policy and to improve cooperation between tax authorities. It has the following general objectives

• to support tax authorities and taxation to enhance the functioning of the single market,
• to foster the Union competitiveness,
• to protect the financial and economic interests of the European Union and its Member States.

and specific objective:

• to support tax policy and tax cooperation,
• to build administrative capacity, including human competency,
• to support the development and operation of the European electronic systems.

The proposed budget will mainly be spent on IT infrastructure, as tax cooperation needs a communication network that allows national administrations to exchange information securely.

The programme will be implemented in direct management mode by the European Commission and in a priority-based manner. The  actions will be open to third countries which are not covered by the European neighbourhood policy or are not acceding or candidates’ countries. The  financing may go up to 100% of eligible actions' costs. 

The regulation also establishes Multi-Annual Strategic Plan for Taxation (MASP-T) for listing all tasks relevant to the development and operation of the European electronic system, similar to those already existing in the field of customs in order to create a coherent and interoperable electronic environment for taxation in the Union, to ensure coherence and coordination of IT capacity building actions.

The financial envelope for the programme should be € 239 million in 2018 prices (EU-27) for the period 2021-2027, up from € 228 million (2018 prices) in the current MFF (€ 226 million if the 2018 value is computed for EU-27).

The legal basis of this proposal is Article 114 (establishment and functioning of the internal market) and Article 197 (administrative cooperation) of the Treaty on the Functioning of the European Union (TFEU). The proposal has to be adopted following the ordinary legislative procedure.

The Budgets Committee (BUDG) adopted its opinion on 5 November 2018, which stresses inter alia: the fight against fraud and the need for interoperability between common and national components of the European electronic systems and synergies with other EU programmes and their electronic systems (including the customs programme, the EU anti-fraud programme, the Single Market Programme and the reform and suport programme). It also proposes a bigger financial envelope (€ 339 million in current prices instead of € 270 million as suggested by the Commission). The Committtee also requested that the interim evaluation should take place three years after the start of the programme implementation (instead of the four years proposed by the Commission).

The report prepared by the Economic and Monetary Affairs Committee (rapporteur Sven Giegold, Greens/EFA, Germany) was adopted by the Plenary on 17 January 2019.

In the Council, the proposal is examined by the Working Party on Tax Questions (Fiscalis) preparing the work of COREPER and Council.

A common understandings was reached in March 2019 after two triologue  meetings. The common understanding was confirmed at COREPER level on 27 March 2019.

On 8 February 2021 ECON Committee decision to enter into interinstitutional negotiations was announced in plenary, a compromise was reached with the Council on 30 March 2021. The provisional agreement was approved by ECON on 22 April 2021 and endorsed by Coreper, for the Council, on 5 May. Following the Council's formal adoption of its first-reading position on the proposal, Parliament had debated this during the May plenary session, on the basis of a recommendation from the ECON committee. Parliament's adoption at second reading thus completed the legislative procedure, enabling the regulation to enter into force and apply, with retroactive effect, from 1 January 2021. The Final act was signed on 20 May 2021.

References

• EP Legislative Observatory, Procedure file for the Fiscalis programme for cooperation in the field of taxation 2021–2027, 2018/0233(COD)
• European Commission, Proposal for a regulation of the European Parliament and the Council establishing the 'Fiscalis' programme for cooperation in the field of taxation, COM(2018) 443, 8 June 2018
• Regulation (EU) No 1286/2013 of the European Parliament and of the Council of 11 December 2013 establishing an action programme to improve the operation of taxation systems in the European Union for the period 2014-2020 (Fiscalis 2020) and repealing Decision No 1482/2007/EC, OJ L 347, 20 December 2013
• European Parliamentary Research Service, 2021-2027 multiannual financial framework and new own resources: analysis of the Commission's proposal, July 2018
• Council, Note Multiannual Financial Framework (MFF) 2021-2027 - Progress report, 18 March 2019
• Council, Outcome of proceedings, Common understanding, 28 March 2019
• Council, Information note 'Outcome of the European Parliament's first reading (Strasbourg, 15 to 18 April 2019)', 1 July 2019
• Economic and Social Committee, Fiscalis for 2021-2027, ECO/470 – EESC-2018-02780-00-00-AC-TRA

Author: Miroslava Karaboytcheva, Members' Research Service, legislative-train@europarl.europa.eu