01.05.2008

Can we expect Europe to be united or divided by a common EU Company tax soon? At a joint press conference following the opening session of the Brussels Tax Forum 2008, Christine Lagarde, French Minister for Economic Affairs, Industry and Employment, indicated that France, during its six months presidency of the EU, will be pushing for an agreement on the common consolidated corporate tax.

Her statements have not been well received by all of Europe. It seems that the tax issue raises old worries about loss of national sovereignty for fear that this could only lead to a future harmonisation of tax rates. Ireland, having attracted many foreign investors with its low corporate tax rate in the 1990s, is especially weary of this project, fearing more general tax harmonisation. But not to fret, for EU tax issues can only be decided by unanimity.