Malta Welcomes Agreement On Flexible BEPS Responses
by Lorys Charalambous, Lowtax.net, Cyprus
10 December, 2015
Edward Scicluna, Malta's Minister for Finance, said he is "extremely satisfied" with the outcome of the recent Economic and Financial Affairs Council (ECOFIN) meeting on December 8 in successfully brokering flexibility for Malta in its response to base erosion and profit shifting.
ECOFIN, which is made up of finance and economy ministers from the EU member states, agreed a response to the OECD's base erosion and profit shifting (BEPS) recommendations at its meeting in Brussels. Ministers agreed to strengthen the EU Code of Conduct Group on business taxation in particular and task it with providing BEPS-related guidance.
Scicluna had told EU ministers that while Malta sees the OECD work made in the area of taxation in a positive light and is studying its outcomes, it harbors concerns on the appropriateness of rigid rules for all. He highlighted that the OECD has recognized that the flexibility which is allowed by the OECD recommendations must be retained by the European Commission when it issues its proposals on BEPS. "Those OECD recommendations provide for a multitude of options and this, in itself, should indicate the way forward," he said.
Malta was alone in proposing the inclusion of a "common yet flexible approach" in the Council Conclusion on BEPS, securing its inclusion in the final draft. On the Code of Conduct, with respect to the reference to the effective level of taxation within the EU, Malta together with Ireland and Cyprus obtained a consensus for the inclusion of an amendment whereby national competences on the matter will be retained.
At the end of the meeting, Scicluna stated: "I am extremely satisfied that an acceptable compromise was found in both instances; for this we are grateful to the Presidency."
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