You can get in contact to arrange a visit, ask questions about the work of both institutions, and request a document, among other services. Aggressive tax planning practices, which are most often employed by large multinational companies, have a particularly negative impact on the competitive position of small and medium-sized enterprises, as they cannot afford the high cost of consulting fees related to such tax solutions. The European Council brings together EU leaders at least four times a year. The 2016 CCTB provides for the determination of a single set of rules for … Therefore, the Commission re-enforced the original CCCTB proposal and re-launched it through a more manageable process. This is particularly important for small and start-up companies. The draft contains an EU-wide tax deduction for companies investing in research and development. The proposals incorporated the Council's suggestions on the previous (2011) proposal to establish the CCCTB, notably the compromise proposal of the Council presidency of November 2014 as well as the Council's work on anti-tax-avoidance measures. a common system for calculating the tax base of businesses operating in the EU: the Common Consolidated Corporate Tax Base (CCCTB). The CCCTB is a modern, fair and competitive corporate tax framework for the EU. Follow the latest developments on policy-making and on legislation under negotiation. We´d love to know what you think about our website. The Council adopted conclusions confirming the view that the work should first focus on the proposal to establish a common corporate tax base. The CCCTB will be mandatory for large multinationals. Corporate tax is then consolidated according to a complicated set of criteria and distributed out to member states based on the level of economic activity that takes place in their jurisdiction. The Commission had originally proposed the CCCTB in 2011, but that proposal proved too ambitious for Member States to agree in one go. The CCCTB will eliminate mismatches between national systems, preferential regimes and hidden tax rulings, which tax avoiders exploit. It will allow companies to offset profits in one Member State against losses in another. Provisions against corporate tax avoidance (profit-shifting). Read more about the role of the European Council, Proposal for a Council directive on a common corporate tax base, Proposal for a Council directive on a common consolidated corporate tax base, Presidency compromise proposal on 2011 proposal for a Council directive on common consolidated corporate tax base, November 2014, Anti tax avoidance package (background information), Common corporate tax base: Council policy debate, May 2017, Economic and Financial Affairs Council, 23/05/2017, Council conclusions on building a fair, competitive and stable corporate tax system for the EU, Economic and Financial Affairs Council, 6 December 2016, proposal for a directive establishing a common  corporate tax base (CCTB), proposal for a directive establishing a common consolidated corporate tax base (CCCTB), The rules for calculating the tax base, especially the newly introduced elements (Chapters I to V), Remaining elements of the proposal on the common base (chapters VI-X), starting with those that had already been discussed in 2011, when the first proposal was analysed,  and then moving on to the anti-tax-avoidance elements, which are also related to the recently adopted anti-tax-avoidance directive, Proposal on a common consolidated corporate tax base. The CCCTB is in short the EU's attempt to completely harmonise corporation tax policy by the back door, creating a common system for taxing large companies across Europe. The CCTB is stage one of a two-stage approach towards an EU-wide corporate tax system and it lays down common corporate tax rules for computing the tax base of large companies and permanent establishments in the EU. Example: Member State A may allow assets to be depreciated over 10 years, for tax purposes, while Member State B might allow it as quickly as over five years. The European Council is the EU institution that defines the general political direction and priorities of the European Union. This would reduce administrative costs and increase legal certainty for businesses by making the calculation of their taxable profits uniform in all EU countries. Differences in national corporate tax regimes across the EU create favourable conditions for transnational corporations to engage in tax planning schemes, which most commonly consist of shifting their profits to lower-tax jurisdictions (to the so-called 'preferential tax regimes'). The proposal was therefore reworked by the European Commission and split into two directives: a directive establishing a common corporate tax base (CCTB), and a directive on a common consolidated corporate tax base (CCCTB). However, the technical work on its anti-tax-avoidance aspects led to the adoption of the anti tax avoidance  directive in 2016. The draft CCCTB directive sets out technical rules for the consolidation of profits and the apportionment of the consolidated base to the eligible member states.The CCCTB initiative, however, does not aim to harmonise tax rates or possible tax credits in the EU - these issues are outside the scope of the proposals scope. The CCCTB will provide companies with legal certainty and reduce tax obstacles, by providing a single, stable, transparent corporate tax system for the EU. The draft CCTB directive proposes a very broadly defined tax base. Companies spending up to €20 million on R&D would be entitled to an additional yearly deduction of 50% and an additional 25% on  amounts exceeding €20 million. It sequenced the work as follows: The Council's Working Party on Tax Questions started examining the proposals. In July 2013 EU ministers agreed that the establishment of the common corporate tax base should precede its consolidation. The headquarters of the Council of the EU and the European Council are located in Brussels (Belgium). With your permission, we will use AT internet cookies to produce aggregated, anonymous data about our visitors' browsing and behaviour on our website. Also known informally as the EU Council, it is where national ministers from each EU country meet to adopt laws and coordinate policies. Find out more about documents and publications. According to the proposed rules, all revenues will be taxable unless expressly exempted. The CCCTB now includes a new super-deduction for companies that invest in R&D spending, given the importance of such investment for growth and jobs. It helps organise and ensure the coherence of the Council's work and the implementation of its 18-month programme. In the first step, the common base should be implemented. This would be done using a specially designed apportionment formula. It will provide a single EU system for companies to calculate their taxable income and a "one stop shop" to file a tax return for all their EU activity. The CCCTB will give companies similar benefits for equity financing to what they currently get for debt financing, to address the debt-bias in taxation and encourage more solid financing structures and greater economic stability. Council and European Council documents are made available through the public register, in accordance with EU rules on transparency. However, there was still strong demand for the benefits that the CCCTB could offer to Member States and businesses in the EU. With the current international economic environment of increasingly globalised, mobile and digital business models and complex structures of multinational companies, it is becoming difficult for governments to ensure that business income is taxed in the countries in which the value is created. It will incentivise R&D spending, which is crucial for growth, with a super-deduction. To get more information about these cookies, how and why we use them and how you can change your settings, check our cookies policy page. Consolidation should be put in place swiftly afterwards. The General Secretariat of the Council is a body of staff responsible for assisting the European Council and the Council of the EU. The Council of the EU is the institution representing the member states' governments. It will remove the need for transfer pricing, which is a primary route for profit shifting. In July 2013 EU ministers agreed that the establishment of the common corporate tax base should precede its consolidation. The Council of the EU meets in different configurations depending on the topic discussed.

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