Thursday

7th Jul 2022

Juncker seeks to bypass vetoes on tax reform

  • Juncker told France's Liberation newspaper that he has been "weakened" by LuxLeaks (Photo: europarl.europa.eu)

European Commission president Jean-Claude Juncker has indicated he will try and get around member states’ veto powers over fiscal issues when he proposes new laws to clamp down on tax avoidance.

In an interview with the Frankfurter Allgemeine Zeitung, he said he may use a majority vote to get a forthcoming law on the automatic exchange of tax rulings (letters that give companies favourable tax conditions) passed.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

“I have not excluded that we change the rules using a qualified majority (of member states). I will leave the technical and legal aspects aside now but it would affect aspects of administrative cooperation,” he said.

When he initially presented the idea for the new law last month, he noted it would need unanimous agreement by governments – a requirement that essentially ensures the death of any given measure before it is even proposed.

He maintained a similar tax line just ahead of his commission's swearing-in ceremony, saying that fiscal harmonisation is an "absolute necessity".

He added that the issue should not be subject to the will of those trying to escape paying a tax high enough to respond to "minimum ethical and moral standards".

Juncker made the remarks after being buffeted by fresh revelations, published late on Tuesday, about the extent of Luxembourg’s tax avoidance scheme for multinationals – schemes set up while he was prime minister.

While initially keen to avoid talking to press about the first set of revelations, which came out a few days after he started his job, he has since been more forthcoming - speaking to a series of newspapers ahead of and around the 'LuxLeaks' publications.

The revelations have, by his own admission, “weakened” him.

But his job is not considered to be in danger, as the consensus in the European Parliament - mirrored by silence in the EU capitals - has been that it is more important to move on than to create an institutional crisis by topping the EU commission and its chief.

MEPs - who last month voted against a censure vote on Juncker and who decided not to launch an equiry into the matter - are keen to extract some legislative concessions, however.

Gianni Pitella, head of the centre-left Socialists, on Wednesday said dealing with tax fraud must be an "absolute priority" in the commission's work programme, due to be presented next week.

"If this is not done there will be no consensus or political trust from our group," he added.

And with support in the European Parliament so far clear, Juncker is maintaining a combative line in his interviews.

When asked by FAZ whether he would step down if the commission's competition department found that Luxembourg had breached EU state aid rules with its sweetheart deals for Amazon and Fiat Finance, he was dismissive.

"Has a government member ever stepped down because the EU has found state aid to be inadmissible?", he asked.

He noted that while he doesn't personally think his credibility has been damaged, his public image has "suffered".

He also questioned the timing of the revelations, telling journalists ahead of his oath-taking ceremony on Wednesday that the new leaks are "not coincidence".

Spain pushes for taxation debate at EU summit

It was supposed to be all about investments and Russia, but the issue of tax avoidance is likely to creep onto the EU summit agenda, as a letter from the Spanish Prime Minister shows.

Is Orban holding out an olive branch to EPP?

It is Tibor Navracsics, an ex-EU commissioner and minister without portfolio in Orban's new government, who was reportedly picked to work on closer relations between Fidesz and the European People's Party.

Column

'War on Women' needs forceful response, not glib statements

Some modest headway in recognising the unrelenting tide of discrimination and violence facing women worldwide was made at last week's largely self-congratulatory and mostly irrelevant G7 talk-fest. But no one mentioned abortion, just days after the Roe vs Wade decision.

News in Brief

  1. Report: British PM Johnson to resign today
  2. British PM defiant amid spate of resignations
  3. France says EU fiscal discipline rules 'obsolete'
  4. Russia claims untouchable status due to nuclear arsenal
  5. Catalan MEPs lose EU court case over recognition
  6. 39 arrested in migrant-smuggling dragnet
  7. France to nationalise nuclear operator amid energy crisis
  8. Instant legal challenge after ok for 'green' gas and nuclear

Stakeholders' Highlights

  1. Nordic Council of MinistersNordic and Canadian ministers join forces to combat harmful content online
  2. Nordic Council of MinistersNordic ministers write to EU about new food labelling
  3. Nordic Council of MinistersEmerging journalists from the Nordics and Canada report the facts of the climate crisis
  4. Council of the EUEU: new rules on corporate sustainability reporting
  5. Nordic Council of MinistersNordic ministers for culture: Protect Ukraine’s cultural heritage!
  6. Reuters InstituteDigital News Report 2022

Latest News

  1. Is Orban holding out an olive branch to EPP?
  2. EU should freeze all EU funds to Hungary, says study
  3. Legal action looms after MEPs back 'green' nuclear and gas
  4. EU readies for 'complete Russian gas cut-off', von der Leyen says
  5. Rising prices expose lack of coherent EU response
  6. Keeping gas as 'green' in taxonomy vote only helps Russia
  7. 'War on Women' needs forceful response, not glib statements
  8. Greece defends disputed media and migration track record

Join EUobserver

Support quality EU news

Join us