EU: Anti-profit-shifting plan includes compulsory tax rules

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The European Commission (EC) has published its action plan as previously pledged in order to combat tax avoidance by international companies.
It comprises a re-launch of the Common Consolidated Corporate Tax Base, (CCCTB) this time in a compulsory form rather than the voluntary form that was overruled by member states four years ago. It will also propose a reform of the Code of Conduct Group against ‘harmful’ tax competition.

The CCCTB plans to offer an all-inclusive solution to the problems currently being experienced with corporate taxation within member’s states of the EU. It should significantly improve the business environment in the Single Market economy, by making it cheaper and simpler for companies to operate between country borders. Simultaneously, it could serve as an extremely useful tool against corporate tax evasion by removing mismatches between national systems that are currently being experienced and fixing common anti-avoidance techniques.

The intention of the re-launch is to kick-start negotiations on the CCCTB in Council, which have been largely delayed due to the scale of the proposal.