12 Amendments of Daniel BUDA related to 2016/0336(CNS)
Amendment 16 #
Proposal for a directive
Recital 1
Recital 1
(1) Companies which seek to do business across frontiers within the Union encounter serious obstacles and market distortions owing to the existence and interaction of 28 disparate corporate tax systems. Furthermore, tax planning structures have become ever-more sophisticated over time, as they develop across various jurisdictions and effectively take advantage of the technicalities of a tax system or of mismatches between two or more tax systems for the purpose of reducing the tax liability of companies. Although those situations highlight shortcomings that are completely different in nature, they both create obstacles which impede the proper functioning of the internal market. AWithin a more globalised, mobile and digital economic framework, action to rectify those problems should therefore address both types of market deficiencies through the alignment of company tax systems in the Union and the creation of a fairer and more coherent tax environment in which companies can operate.
Amendment 21 #
Proposal for a directive
Recital 4
Recital 4
(4) Considering the need to act swiftly in order to ensure a proper functioning of the internal market by making it, on the one hand, friendlier to trade and investment and, on the other hand, more resilient to tax avoidance schemes, it is necessary to divideadopt a stage-by-stage approach to the ambitious CCCTB initiative before dividing it into two separate proposals. At a first stage, rules on a common corporate tax base should be enacted, before addressing, at a second stage, the issue of consolidation. This directive is part of the second stage, setting out the conditions for being in a group, the possible forms that a group can take and the technical consolidation rules.
Amendment 22 #
Proposal for a directive
Recital 4 a (new)
Recital 4 a (new)
(4a) In this way, the CCCTB is in line with Commission efforts to achieve fairer and more efficient taxation, being largely complementary to EU company law; it is also is broadly in line with projects such as the Capital Markets Union and various initiatives intended to ensure tax transparency, promote the exchange of information and combat money laundering.
Amendment 24 #
Proposal for a directive
Recital 5
Recital 5
(5) Many aggressive tax planning structures tend to feature in a cross-border context, which implies that the participating groups of companies possess a minimum of resources. On this premise, for reasons of proportionality, the rules on a common base should be mandatory only for companies which belong to a group of a substantial size, while exempting micro- enterprises and SMEs. For that purpose, a size- related threshold should be fixed on the basis of the total consolidated revenue of a group which files consolidated financial statements. In addition, to ensure coherence between the two steps of the CCCTB initiative, the rules on a common base should be mandatory for companies which would be considered as a group should the full initiative materialise.
Amendment 26 #
Proposal for a directive
Recital 5 a (new)
Recital 5 a (new)
(5a) Given the digital change in the business environment, it is necessary to define and implement the concept of a ‘digital business establishment’. Companies that generate profits in a Member State without having a physical establishment there should be treated in the same way as companies that do have a physical establishment in that Member State. Therefore, the CCCTB should also apply to digital corporations.
Amendment 28 #
Proposal for a directive
Recital 10
Recital 10
(10) The formula apportionment for the consolidated tax base should comprise three equally weighted factors, namely labour, assets and sales by destination. Those equally weighted factors should reflect a balanced approach to distributing taxable profits amongst the relevant Member States and should ensure that profits are taxed where they are actually earned. Labour and assets should therefore be allocated to the Member State where the labour is performed or the assets are located, and would thereby give appropriate weight to the interests of the Member State of origin, whilst sales should be allocated to the Member State of destination of the goods or services. To account for differences in the levels of wages across the Union and thus allow for a fair distribution of the consolidated tax base, the labour factor should comprise both payroll and the number of employees (i.e. each item counting for half). The asset factor, on the other hand, should comprise all fixed tangible assets, but not intangible and financial assets because of their mobile nature and the resulting risk that the rules of this Directive could be circumvented. Where, due to exceptional circumstances, the outcome of the apportionment does not fairly represent the extent of business activity, a safeguard clause should provide for an alternative method of income allocation. On the other hand, these equally weighted factors are more resilient to aggressive tax planning practices than the widespread transfer pricing methods for allocating profit. In this way, loopholes between national tax systems, in particular transfer pricing, which accounts for around 70% of all profit shifting in the EU, could be eliminated and a major step taken towards a fair, efficient and transparent tax system.
Amendment 31 #
Proposal for a directive
Recital 18
Recital 18
(18) Since the objectives of this Directive, namely to improve the functioning of the internal market through countering practices of international tax avoidance and to facilitate businesses in expanding across borders within the Union, cannot be sufficiently achieved by the Member States acting individually and in a disparate fashion because coordinated action is necessary to obtain these objectives, but can rather, by reason of the fact that the Directive targets inefficiencies of the internal market that originate in the interaction between disparate national tax rules which impact on the internal market and discourage cross-border activity, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve those objectives, especially considering that its mandatory scope is limited to groups beyond a certain size. In fact, the envisaged measures do not go further than harmonising the corporate tax base, which is a prerequisite for curbing identified obstacles that distort the internal market. Furthermore, this stage- by-stage approach entitles Member States to determine their desired amount of tax revenues in order to meet their budgetary policy targets. At the same time, it does not affect Member States' right to set their own profits tax rate.
Amendment 33 #
Proposal for a directive
Article 2 – paragraph 1 – introductory part
Article 2 – paragraph 1 – introductory part
1. The rules of this Directive shall apply to a company that is established under the laws of a Member State, including its permanent and digital business establishments in other Member States, where the company meets all of the following conditions:
Amendment 38 #
Proposal for a directive
Article 2 – paragraph 2 – subparagraph 1
Article 2 – paragraph 2 – subparagraph 1
This Directive shall also apply to a company that is established under the laws of a third country in respect of its permanent establishments situated in one or more Member States, and in relation to revenues otherwise accrued in a Member State, where the company meets the conditions laid down in points (b) to (d) of paragraph 1.
Amendment 41 #
Proposal for a directive
Article 3 – paragraph 1 – point 28 a (new)
Article 3 – paragraph 1 – point 28 a (new)
(28a) ‘Digital business establishment’ means an establishment specifically directed towards consumers and businesses in a Member State and, to that end, account shall be taken of whether the activity is being carried out in the top- level domain of the Member State or of the Union and whether mobile applications are being distributed through part of a distribution centre specifically intended for that purpose in the Member State concerned.
Amendment 42 #
Proposal for a directive
Article 6 – paragraph 1 – point d a (new)
Article 6 – paragraph 1 – point d a (new)
(da) a digital business establishment.
Amendment 44 #
Proposal for a directive
Article 79 – paragraph 1
Article 79 – paragraph 1
The Commission shall, five years after the entry into force of this Directive, review its application and report to the Council and the European Parliament on the operation of this Directive. The report shall in particular include an analysis of the impact of the mechanism set up in Chapter VIII of this Directive on the apportionment of the tax bases between the Member States.