The EU Has a “Plan” Called CCCTB

The EU has a “plan” to curb alleged corporate tax avoidance.

It is called CCCTB or Common Consolidated Corporate Tax Base.

Actually, it has been going on since the early 1990’s.

From the EU communiqué:

“At the heart of today’s Action Plan is a re-launch of the proposed Common Consolidated Corporate Tax Base, or CCCTB, which is the “big bang” when it comes to corporate tax reform.

This single initiative can greatly improve our business environment–which means more investment and job creation –successfully prevent tax avoidance and protect our Single Market from external base erosion.

The idea is simple: we have a Single Market and we have a single rulebook for cross-border company taxation. Companies acting in several Member States would use a single base across all Member States when computing their benefits, instead of using different national bases. The savings in terms of administrative and compliance costs would be close to €1Bn every year. No more mismatches, no more loopholes, unnecessary compliance costs or internal disputes between Member States.

Although the CCCTB is currently deadlocked in the Council, there is strong support for the idea of reviving it: from Member States, the European Parliament, businesses and other stakeholders.

Because the benefits the CCCTB offers are too great to give up, I plan to make a new proposal, with some adjustments, to kick-start successful negotiations.

I intend to bring forward this proposal as early as possible in the new year, with preparatory work to start immediately from today.

I can already tell you that the new proposal will be for a mandatory CCCTB, at least for multinationals. Because it has become clear that a voluntary system will not stop tax avoiders. So we strengthen the proposal in that point.

Since the current proposal has proven too vast to agree in one go, we will be going for a step-by-step approach to implementing the CCCTB, focusing first on the idea of a common base and moving later towards consolidation.

But the clock doesn’t stop in the meantime, because many of the corporate tax problems we face today demand an immediate response.”

See the full EU communique here.

The nuts and bolts of CCCTB are available here

Robert Robillard, Ph.D., CPA, CGA, MBA, M.Sc. Econ.
Senior Partner, DRTP Consulting Inc.
514-742-8086; robertrobillard “at”

DRTP Consulting Inc. solutions go beyond transfer pricing and international tax solutions. The information in this blog post is general information only. Data and information come from sources believed to be reliable but complete accuracy cannot be guaranteed. DRTP Consulting Inc. or the author are not responsible or liable for any error, omission or inaccuracy in such information. The opinions expressed in this blogpost are those of the author. Readers should seek advice and counsel from DRTP Consulting Inc. as required.

Posted by drtp On 18 June 2015