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 aim is to promote innovation in the EU and help smaller companies develop. The CCCTB will be mandatory for large multinationals. Find out more about documents and publications. Provisions against corporate tax avoidance (profit-shifting). With the CCCTB, cross-border companies will only have to comply with one, single EU system for computing their taxable income, rather than many different national rulebooks.Companies can file one tax return for all of their EU activities, and offset losses in one Member State against profits in another.The consolidated taxable profits will be The Council of the EU and the European Council work on a wide range of issues affecting the interests of the EU and its citizens. The draft lists exempt revenues, which include profits from permanent establishments of a company in the state of that company's head office and income from dividends or sale of shares held in a company outside the group. In October 2016, the Commission proposed to re-launch the Common Consolidated Corporate Tax Base. Consolidation should be put in place swiftly afterwards. We will use this data to improve your experience on our website. The system will remain optional for those not captured by the mandatory scope. According to the proposed mechanism, each member state will then be able to tax its apportioned share of the profit at its own national tax rate. It will remove the need for transfer pricing, which is a primary route for profit shifting. Also known informally as the EU Council, it is where national ministers from each EU country meet to adopt laws and coordinate policies. The two draft directives deal with taxation; they will therefore have to be adopted by the special legislative procedure, which requires a unanimous vote at the Council of the EU, after it has consulted the European Parliament. Support growth, jobs and investment in the EU. The new rules would also help member states fight against aggressive tax planning. The CCCTB will fully recognise companies' cross-border activities in the Single Market. The CCCTB will be implemented in two steps. 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). Small start-up companies would be entitled to deduct 100% of their R&D costs, as long as those expenses do not exceed €20 million and provided that those small companies do not have any associated enterprises. 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. It will incentivise R&D spending, which is crucial for growth, with a super-deduction. Currently businesses in the EU need to comply with the requirements of different national corporate taxation systems, which can be a considerable administrative burden and an obstacle to cross-border investment in the EU. The CCCTB will give strong incentives to R&D. Common Corporate Tax Base – One single set of EU rules to decide how much of a company's profit will be taxed, once various exemptions and income deductions have been accounted for. The initiative consists of two legislative proposals: The previous proposal to establish a common consolidated corporate tax base, published in 2011, did not find approval in the Council. The European Council brings together EU leaders at least four times a year. With your permission, we will use AT internet cookies to produce aggregated, anonymous data about our visitors' browsing and behaviour on our website. You can also take a look at Council publications, access the archives and search for legislation that the Council negotiates together with the European Parliament. Factsheet2016 proposal on Common Tax Base - Annex2016 proposal on Consolidation - Annex. 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. It sequenced the work as follows: The Council's Working Party on Tax Questions started examining the proposals. However, there was still strong demand for the benefits that the CCCTB could offer to Member States and businesses in the EU. The CCCTB can lift investment in the EU by 3.4% and growth by up to 1.2%. The draft CCTB directive proposes a very broadly defined tax base. a common system for calculating the tax base of businesses operating in the EU: the Common Consolidated Corporate Tax Base (CCCTB). You can get in contact to arrange a visit, ask questions about the work of both institutions, and request a document, among other services. Companies can file one tax return for all of their EU activities, and offset losses in one Member State against profits in another. The Council of the EU is the institution representing the member states' governments. In July 2013 EU ministers agreed that the establishment of the common corporate tax base should precede its consolidation. This would be done using a specially designed apportionment formula. Follow the latest developments on policy-making and on legislation under negotiation. It consists of the heads of state or government of the member states, together with its President and the President of the Commission. The second stage seeks to bring about a fully consolidated corporate tax base, or CCCTB, across Member States. This rule would remain in force until the introduction of the CCCTB, which aims to make cross-border loss relief automatic. 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. The Council held an orientation debate on the CCTB proposal with the aim of establishing the right balance between two needs: the need to harmonise the rules across the EU and the need to maintain the right level of flexibility in their application. 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.
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