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Minimum tax for multinationals: MEPs want to circumvent the Hungarian veto

2022-07-06T17:41:23.048Z

Hungary opposed the minimum tax of 15% on the profits of multinationals, supported by all the other Member States.



The European Parliament passed a resolution on Wednesday denouncing the Hungarian veto against the minimum tax on multinationals and calling for the abandonment of unanimity on tax issues in order to circumvent the deadlock.

On 17th June Hungary opposed the transposition into European law of the minimum tax of 15% on the profits of multinationals, supported by all the other Member States.

A unanimous vote of the Twenty-Seven is necessary to validate the draft directive prepared by the European Commission.

Read alsoGlobal minimum corporate tax: Europe's obstacle course

The EU wants to become the first legal entity to give reality to the historic project approved last year by nearly 140 countries - including Hungary - under the aegis of the OECD, after five years of debate.

Before the Hungarian veto, the directive had been blocked for months by Poland, also a signatory to the OECD agreement.

Poland is suspected of having used its right of veto as a means of pressure to obtain the release of the 35.4 billion euros in grants and loans planned for the country as part of the European recovery plan.

She also lifted her opposition just after obtaining a green light from the Commission for this plan, blocked for more than a year because of shortcomings alleged in Warsaw in terms of judicial independence.

The Hungarian plan, equipped with 7,

2 billion euros in subsidies, is still blocked due to an insufficient fight against corruption.

Budapest is accused by European officials of having followed in Warsaw's footsteps to force the hand of the Commission.

Read also Against “blackmail” from Brussels, Poland threatens to veto the EU budget

In their resolution, MEPs "

call on Hungary to immediately end its blocking of the tax agreement

" and "

urge the Commission and the Council (which represents the 27 EU countries) not to commit in a political bargain

" with Budapest.

The text, which received a majority of 450 votes (132 against, 55 abstentions), also invites the Commission and the Council to consider “

implementing the global tax agreement by means of the enhanced cooperation procedure

”.

This provision allows the implementation of measures by a group of voluntary countries when unanimity is not possible.

Read alsoMinimum tax at 15%: additional revenue expected for the French state, the amount still debated

Finally, he wants the European executive to relaunch “

the debate on the use of qualified majority voting for certain tax issues

”.

Since the start of the year, Poland and then Hungary have used their veto to prevent the introduction of the minimum tax (...).

These two countries which do not respect the rule of law ultimately have more power than the 25 other Member States combined

,” lamented French MEP Aurore Lalucq (S&D, left), in charge of the negotiations for this resolution.

On the fiscal level, it is 50 billion euros that we lose each year

”, she underlined in a press release.

Source: lefigaro

All business articles on 2022-07-06

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