# C_2011318EN.01009501.xml

| 29.10.2011 | EN | Official Journal of the European Union | C 318/95 |
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29.10.2011

EN

Official Journal of the European Union

C 318/95

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Opinion of the European Economic and Social Committee on the ‘Communication from the Commission to the Council, the European Parliament and the European Economic and Social Committee: Removing cross-border tax obstacles for EU citizens’

COM(2010) 769 final

2011/C 318/15

Rapporteur: Mr FARRUGIA

Mr FARRUGIA

On 20 December 2010 the Commission decided to consult the European Economic and Social Committee, under Article 113 of the Treaty on the Functioning of the European Union, on the

Communication from the Commission to the Council, the European Parliament and the European Economic and Social Committee: Removing cross-border tax obstacles for EU citizens

Communication from the Commission to the Council, the European Parliament and the European Economic and Social Committee: Removing cross-border tax obstacles for EU citizens

COM(2010) 769 final.

The Section for Economic and Monetary Union and Economic and Social Cohesion, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 24 June 2011.

At its 473rd plenary session, held on 13 and 14 July 2011 (meeting of 14 July 2011), the European Economic and Social Committee adopted the following opinion by 74 votes with 5 abstentions.

1.   Conclusions and recommendations

Conclusions and recommendations

| 1.1 | The existence of different tax jurisdictions in the EU imposes an added burden on EU citizens who work, invest and operate across borders because of double taxation and of overlaps of administrative requirements. These conditions are causing effective impediments to the proper operation of the Single Market and are denting the fundamental rights of EU citizens. Small businesses tend to be disproportionately negatively affected by these impediments. |
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1.1

The existence of different tax jurisdictions in the EU imposes an added burden on EU citizens who work, invest and operate across borders because of double taxation and of overlaps of administrative requirements. These conditions are causing effective impediments to the proper operation of the Single Market and are denting the fundamental rights of EU citizens. Small businesses tend to be disproportionately negatively affected by these impediments.

| 1.2 | The EESC is of the opinion that existing tax rules across the Union are not able to prevent discrimination between citizens of different countries and to eliminate obstacles on the freedom of movement of people, goods, services and capital. |
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1.2

The EESC is of the opinion that existing tax rules across the Union are not able to prevent discrimination between citizens of different countries and to eliminate obstacles on the freedom of movement of people, goods, services and capital.

| 1.3 | In order to remedy for these problems, the EESC recommends the following actions aimed at removing double taxation and enhancing administrative simplification in cross-border situations:






  — | the establishment of one-stop shop services whereby citizens can acquire information, pay taxes and receive the necessary certificates and documentation to be used across the entire EU; |
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1.3

In order to remedy for these problems, the EESC recommends the following actions aimed at removing double taxation and enhancing administrative simplification in cross-border situations:

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the establishment of one-stop shop services whereby citizens can acquire information, pay taxes and receive the necessary certificates and documentation to be used across the entire EU;

| — | the simplification of administrative procedures applied to cross-border situations to be undertaken on bi-lateral and multi-lateral bases across Member States, including inter alia the removal of double taxation and the utilisation of administrative instruments to ensure the seamless operation of the numerous existing double taxation agreements; |
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the simplification of administrative procedures applied to cross-border situations to be undertaken on bi-lateral and multi-lateral bases across Member States, including inter alia the removal of double taxation and the utilisation of administrative instruments to ensure the seamless operation of the numerous existing double taxation agreements;

inter alia

| — | the provision of advance tax rulings giving information on the final tax liability outcome which is specifically tailored to the individual taxpayer; |
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the provision of advance tax rulings giving information on the final tax liability outcome which is specifically tailored to the individual taxpayer;

| — | the setting-up of an independent Cross-Border Taxation Observatory that should, after an early initial period operating under the auspices of the European Commission with specific resources and functions clearly entrusted to it, be concurrently developed over a period of three years into an institution with full legal personality under public law with the status of a Policy Agency. The Observatory aims to gain, on an on-going basis, a detailed and practical understanding of existing tax barriers and their evolution and whose functions entrusted to it shall include:






  — | the investigation of tax obstacles as reported by EU citizens; |
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the setting-up of an independent Cross-Border Taxation Observatory that should, after an early initial period operating under the auspices of the European Commission with specific resources and functions clearly entrusted to it, be concurrently developed over a period of three years into an institution with full legal personality under public law with the status of a Policy Agency. The Observatory aims to gain, on an on-going basis, a detailed and practical understanding of existing tax barriers and their evolution and whose functions entrusted to it shall include:

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the investigation of tax obstacles as reported by EU citizens;

| — | the undertaking of research to uncover other obstacles; |
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the undertaking of research to uncover other obstacles;

| — | the investigation of the effectiveness of on-going efforts to remove obstacles; |
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the investigation of the effectiveness of on-going efforts to remove obstacles;

| — | the estimation of the effects on EU citizens of the matters under the purview of the Observatory; |
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the estimation of the effects on EU citizens of the matters under the purview of the Observatory;

| — | regular reviews of changes in tax policies and administrative requirements within EU Member States so as to assess the extent and manner in which tax obstacles may be evolving, and to specifically highlight and report on instances where such obstacles would be increasing; |
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regular reviews of changes in tax policies and administrative requirements within EU Member States so as to assess the extent and manner in which tax obstacles may be evolving, and to specifically highlight and report on instances where such obstacles would be increasing;

| — | the study of the introduction of tax equalisation mechanisms, whereby workers who change their place of work between countries within the EU on a frequent basis would be able to pay tax always under the same, single jurisdiction, possibly in the country where the worker is registered for social security; |
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the study of the introduction of tax equalisation mechanisms, whereby workers who change their place of work between countries within the EU on a frequent basis would be able to pay tax always under the same, single jurisdiction, possibly in the country where the worker is registered for social security;

| — | to study the extent to which harmonisation is effective in the context of specific tax regimes such as VAT and the way in which its implementation or lack thereof is impinging on tax distortions within the Single Market; |
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to study the extent to which harmonisation is effective in the context of specific tax regimes such as VAT and the way in which its implementation or lack thereof is impinging on tax distortions within the Single Market;

| — | the establishment of ad hoc working groups to gather information and propose solutions in the context of the above issues; |
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the establishment of ad hoc working groups to gather information and propose solutions in the context of the above issues;

| — | the issuing of reports on regular and ad hoc bases to detail the results of the work of the Observatory and to provide recommendations to eliminate tax obstacles to cross-border situations. |
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the issuing of reports on regular and ad hoc bases to detail the results of the work of the Observatory and to provide recommendations to eliminate tax obstacles to cross-border situations.

ad hoc

| 1.4 | In more general terms, it is the opinion of the EESC that the responsibility for the efficient undertaking of tax procedures in cross-border situations should not be put down on the individual citizen, but that there should be proper mechanisms in place to ensure that the operating procedures are simple and clear enough for the citizen to be able to cope with. While recognising the valid contribution made by available facilities for citizens to report tax obstacles, the effort of policy to remove such obstacles should progress beyond this. |
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1.4

In more general terms, it is the opinion of the EESC that the responsibility for the efficient undertaking of tax procedures in cross-border situations should not be put down on the individual citizen, but that there should be proper mechanisms in place to ensure that the operating procedures are simple and clear enough for the citizen to be able to cope with. While recognising the valid contribution made by available facilities for citizens to report tax obstacles, the effort of policy to remove such obstacles should progress beyond this.

| 1.5 | In proposing these recommendations, the EESC is at this stage focusing on the removal of tax barriers rather than addressing the wider issue of tax harmonisation. The latter may be interpreted as one of the criteria required for a Single Market, but it may also be in conflict with other fundamental objectives of the European Union. |
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1.5

In proposing these recommendations, the EESC is at this stage focusing on the removal of tax barriers rather than addressing the wider issue of tax harmonisation. The latter may be interpreted as one of the criteria required for a Single Market, but it may also be in conflict with other fundamental objectives of the European Union.

| 1.6 | The removal of tax obstacles for cross-border situations is necessary to uphold the individual rights of citizens, to promote competitiveness especially of SMEs and to enhance the knowledge and research base of the European economy in line with the EU2020 targets. |
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1.6

The removal of tax obstacles for cross-border situations is necessary to uphold the individual rights of citizens, to promote competitiveness especially of SMEs and to enhance the knowledge and research base of the European economy in line with the EU2020 targets.

2.   Context

Context

| 2.1 | The original action programme under the Single Market Act was aimed at removing all tax-related obstacles to cross-border business. The 1985 White Paper proposed measures that targeted the elimination of tax barriers though the removal of obstacles related to the different indirect taxes, but these issues remain pending. A unanimous vote is required for the establishment of or amendments to measures involving taxation. |
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2.1

The original action programme under the Single Market Act was aimed at removing all tax-related obstacles to cross-border business. The 1985 White Paper proposed measures that targeted the elimination of tax barriers though the removal of obstacles related to the different indirect taxes, but these issues remain pending. A unanimous vote is required for the establishment of or amendments to measures involving taxation.

| 2.2 | The removal of tax barriers among Member States is mentioned in the ‘Europe 2020 Strategy’ (1), which highlights the importance of eliminating tax obstacles to achieve a fully operational Single Market. |
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2.2

The removal of tax barriers among Member States is mentioned in the ‘Europe 2020 Strategy’ (1), which highlights the importance of eliminating tax obstacles to achieve a fully operational Single Market.

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| 2.3 | On 12 December 2010, the European Commission issued a Communication paper based on issues related to the removal of cross-border tax obstacles for EU citizens, with specific reference to income, capital and inheritance tax, tax on dividends vehicle registration and circulation taxes and taxation in the e-commerce market. |
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2.3

On 12 December 2010, the European Commission issued a Communication paper based on issues related to the removal of cross-border tax obstacles for EU citizens, with specific reference to income, capital and inheritance tax, tax on dividends vehicle registration and circulation taxes and taxation in the e-commerce market.

3.   General Comments

General Comments

| 3.1 | Over the past decade, growth in the movement of goods, services and capital raised more concern on problems associated with cross-border taxation, as reported through initiatives such as Your Europe Advice, SOLVIT, the Europe Direct Contact the European Customer Centres, The European Enterprise Network and the European Employment Services (EURES). The need for better coordination in the implementation of tax policies has also been recognised by the heads of State or Governments in the euro area. |
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3.1

Over the past decade, growth in the movement of goods, services and capital raised more concern on problems associated with cross-border taxation, as reported through initiatives such as Your Europe Advice, SOLVIT, the Europe Direct Contact the European Customer Centres, The European Enterprise Network and the European Employment Services (EURES). The need for better coordination in the implementation of tax policies has also been recognised by the heads of State or Governments in the euro area.

| 3.2 | Tax discrimination issues related to nationality and other unjustified restrictions are mainly tackled through EU Treaty rules. However, the current system does not protect EU citizens against various other problems including limited tax information access, which is widely regarded as a major obstacle to cross-border situations (2), double taxation and mismatches occurring from different tax structures. Although it has been widely recognised that complete tax harmonisation is neither desirable nor feasible, measures that lower tax barriers to cross-border business are necessary. |
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3.2

Tax discrimination issues related to nationality and other unjustified restrictions are mainly tackled through EU Treaty rules. However, the current system does not protect EU citizens against various other problems including limited tax information access, which is widely regarded as a major obstacle to cross-border situations (2), double taxation and mismatches occurring from different tax structures. Although it has been widely recognised that complete tax harmonisation is neither desirable nor feasible, measures that lower tax barriers to cross-border business are necessary.

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| 3.3 | Double taxation on income is one of the main obstacles for cross-border activity and it limits the functions of the Internal Market. Other tax barriers relate to problems in obtaining allowances, tax reliefs and deductions from foreign tax authorities. In some cases EU citizens pay higher taxes on foreign income. Discrimination in capital gains tax present another challenge to Member States. Under the current system, foreign investors in most EU countries are required to pay higher taxes than residents. The Commission is planning to present possible solutions by firstly preparing an impact assessment so as to consider the problems arising from the improper or insufficient functioning of existing instruments to relieve double taxation, such as bilateral double taxation treaties on both income and capital. |
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3.3

Double taxation on income is one of the main obstacles for cross-border activity and it limits the functions of the Internal Market. Other tax barriers relate to problems in obtaining allowances, tax reliefs and deductions from foreign tax authorities. In some cases EU citizens pay higher taxes on foreign income. Discrimination in capital gains tax present another challenge to Member States. Under the current system, foreign investors in most EU countries are required to pay higher taxes than residents. The Commission is planning to present possible solutions by firstly preparing an impact assessment so as to consider the problems arising from the improper or insufficient functioning of existing instruments to relieve double taxation, such as bilateral double taxation treaties on both income and capital.

| 3.4 | Different Member States apply different inheritance tax rules while bilateral tax agreements among Member States are very limited. Over 80 % of these Member States have an inheritance tax while the remaining adopted an estate tax. The Commission has undertaken a consultation process and will shortly propose how Member States could design non-discriminatory inheritance tax systems and make their double tax relief mechanisms more comprehensive so as to lower cross-border inheritance tax obstacles as much as possible. |
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3.4

Different Member States apply different inheritance tax rules while bilateral tax agreements among Member States are very limited. Over 80 % of these Member States have an inheritance tax while the remaining adopted an estate tax. The Commission has undertaken a consultation process and will shortly propose how Member States could design non-discriminatory inheritance tax systems and make their double tax relief mechanisms more comprehensive so as to lower cross-border inheritance tax obstacles as much as possible.

| 3.5 | Taxes on dividend payments are usually paid in two Member States where cross-border situations are involved. This raises problems in relation to economic and juridical double taxation as well as problems of tax refunds particularly when various layers of taxation are involved. An impact assessment is being drafted by the Commission from which an initiative to resolve the cross-border taxation problems that arise when dividends are paid across borders to portfolio investors shall be outlined. |
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3.5

Taxes on dividend payments are usually paid in two Member States where cross-border situations are involved. This raises problems in relation to economic and juridical double taxation as well as problems of tax refunds particularly when various layers of taxation are involved. An impact assessment is being drafted by the Commission from which an initiative to resolve the cross-border taxation problems that arise when dividends are paid across borders to portfolio investors shall be outlined.

| 3.6 | The need for streamlining vehicle registration and circulation taxes across the EU is expressed in a Directive (3) proposed by the Commission in 2005, aims at phasing out car registration taxes while applying a system of refund. Still, there has been no unanimous agreement in this regard, and this issue is being re-assessed. |
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3.6

The need for streamlining vehicle registration and circulation taxes across the EU is expressed in a Directive (3) proposed by the Commission in 2005, aims at phasing out car registration taxes while applying a system of refund. Still, there has been no unanimous agreement in this regard, and this issue is being re-assessed.

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| 3.7 | Research has shown that around 60 % of EU customers find problems in buying goods and services online across borders (4). VAT issues are one of the tax obstacles discouraging businesses to sell their product to foreign Member States. The availability of a one-stop shop has facilitated trade in this regard and encouragement of broader application of this application is deemed to be a priority (5). Consultation on this matter in the form of a Green Paper (6) is currently under way. |
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3.7

Research has shown that around 60 % of EU customers find problems in buying goods and services online across borders (4). VAT issues are one of the tax obstacles discouraging businesses to sell their product to foreign Member States. The availability of a one-stop shop has facilitated trade in this regard and encouragement of broader application of this application is deemed to be a priority (5). Consultation on this matter in the form of a Green Paper (6) is currently under way.

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4.   Specific Comments

Specific Comments

| 4.1 | Tax obstacles are curtailing the realisation of the main scope of the Single Market, that is, the freedom of movement of people, goods, services and capital. |
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4.1

Tax obstacles are curtailing the realisation of the main scope of the Single Market, that is, the freedom of movement of people, goods, services and capital.

| 4.2 | Improved access and better information are essential for good governance in tax policy. In 2009, the European Commission issued a paper – ‘Promoting Good Governance in Tax Matters’ (7) – which states that good governance in the tax policy area would lead to enhanced administrative cooperation and thus better economic relations. This would facilitate information exchange among Member States and also promotes bilateral agreements. |
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4.2

Improved access and better information are essential for good governance in tax policy. In 2009, the European Commission issued a paper – ‘Promoting Good Governance in Tax Matters’ (7) – which states that good governance in the tax policy area would lead to enhanced administrative cooperation and thus better economic relations. This would facilitate information exchange among Member States and also promotes bilateral agreements.

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| 4.3 | Where double taxation still exists, countries should be encouraged to remove it in comprehensive manners that take into account all forms of taxation. Where agreements to remove double taxation are already in place, specific arrangements (e.g. binding arbitration) should be implemented to ensure that such agreements operate properly. It is furthermore important for any additional tax systems that are in the implementation process to be examined to safeguard EU citizens against new elements of double taxation. |
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4.3

Where double taxation still exists, countries should be encouraged to remove it in comprehensive manners that take into account all forms of taxation. Where agreements to remove double taxation are already in place, specific arrangements (e.g. binding arbitration) should be implemented to ensure that such agreements operate properly. It is furthermore important for any additional tax systems that are in the implementation process to be examined to safeguard EU citizens against new elements of double taxation.

| 4.4 | In this spirit, the EESC is proposing four measures in order to remedy for double tax problems while enhancing administrative simplification in cross-border situations. These measures are: (i) the establishment of one-stop shop services; (ii) the simplification of administrative procedures; (iii) the provision of advance tax rulings; and (iv) the setting-up of a cross-border taxation Observatory exercise. |
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4.4

In this spirit, the EESC is proposing four measures in order to remedy for double tax problems while enhancing administrative simplification in cross-border situations. These measures are: (i) the establishment of one-stop shop services; (ii) the simplification of administrative procedures; (iii) the provision of advance tax rulings; and (iv) the setting-up of a cross-border taxation Observatory exercise.

| 4.5 | One-stop shops as considered in this document would have two primary aims. One is to serve as information centres where EU citizens can obtain all the necessary required information related to taxation in a form which is direct, accessible and relevant. The EESC is also proposing a second function for such one-stop shops, namely to act as service point for citizens who are liable to pay taxes offering extended services including the provision of certificates and documentation related to taxation. |
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4.5

One-stop shops as considered in this document would have two primary aims. One is to serve as information centres where EU citizens can obtain all the necessary required information related to taxation in a form which is direct, accessible and relevant. The EESC is also proposing a second function for such one-stop shops, namely to act as service point for citizens who are liable to pay taxes offering extended services including the provision of certificates and documentation related to taxation.

| 4.6 | Helping EU citizens adapt to the current and any potential future tax rules requires the simplification of administrative procedures from existing ones. This measure particularly refers to double tax agreements. Moreover, the implementation of tax systems which are centred on the provision of tailor-made advance tax rulings, catering for the specific characteristics and conditions of individual situations, is an efficient way of enhancing transparency of tax procedures for EU citizens and reducing uncertainty involved in cross-border situations for firms and citizens alike. |
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4.6

Helping EU citizens adapt to the current and any potential future tax rules requires the simplification of administrative procedures from existing ones. This measure particularly refers to double tax agreements. Moreover, the implementation of tax systems which are centred on the provision of tailor-made advance tax rulings, catering for the specific characteristics and conditions of individual situations, is an efficient way of enhancing transparency of tax procedures for EU citizens and reducing uncertainty involved in cross-border situations for firms and citizens alike.

| 4.7 | Finally, the EESC is through this text actively promoting the setting up of an Observatory exercise in relation to obstacles to cross border situations. This initiative is deemed essential for examining, on a frequent basis, current and potential future obstacles emerging from tax policies and the effectiveness of such policies in removing obstacles. The outcomes emerging from regular research and investigations in this regard shall be published in regular reports together with proposals related to the elimination of the tax barriers in question. The Observatory would use various sources to identify obstacles, including the available instruments based on reporting by citizens, as well as through the undertaking of specific research. An important element of the reporting function of the Observatory would be to assess the welfare implications of such obstacles on EU citizens in general, on business, and on specific categories within them. |
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4.7

Finally, the EESC is through this text actively promoting the setting up of an Observatory exercise in relation to obstacles to cross border situations. This initiative is deemed essential for examining, on a frequent basis, current and potential future obstacles emerging from tax policies and the effectiveness of such policies in removing obstacles. The outcomes emerging from regular research and investigations in this regard shall be published in regular reports together with proposals related to the elimination of the tax barriers in question. The Observatory would use various sources to identify obstacles, including the available instruments based on reporting by citizens, as well as through the undertaking of specific research. An important element of the reporting function of the Observatory would be to assess the welfare implications of such obstacles on EU citizens in general, on business, and on specific categories within them.

| 4.8 | The implementation of an Observatory exercise will ensure that tax policies being implemented are effective in practice especially with regards to job mobility. In particular, the Observatory would be mandated to study a system whereby workers who change jobs from one country to another on a frequent basis would pay taxes under a single jurisdiction, preferably at the country where the worker is registered for social security. This so-called ‘Tax Equalisation’ system could be operated through clearing houses set up specifically for the purposes, either within private companies or as part of public institutions. The Observatory would be called to make a cost-benefit assessment in this regard, and to make recommendations on the best approaches towards implementation of such systems within different contexts. |
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4.8

The implementation of an Observatory exercise will ensure that tax policies being implemented are effective in practice especially with regards to job mobility. In particular, the Observatory would be mandated to study a system whereby workers who change jobs from one country to another on a frequent basis would pay taxes under a single jurisdiction, preferably at the country where the worker is registered for social security. This so-called ‘Tax Equalisation’ system could be operated through clearing houses set up specifically for the purposes, either within private companies or as part of public institutions. The Observatory would be called to make a cost-benefit assessment in this regard, and to make recommendations on the best approaches towards implementation of such systems within different contexts.

| 4.9 | In addition, the Observatory should undertake studies related to the optimal level of harmonisation with regards to specific tax systems such as VAT, enabling a more detailed analysis associated with the implications of tax distortions on the main elements of the Single Market. Ad hoc working groups would be set up under the Observatory to study specific problems and issues that may arise from time to time and to propose solutions thereto. |
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4.9

In addition, the Observatory should undertake studies related to the optimal level of harmonisation with regards to specific tax systems such as VAT, enabling a more detailed analysis associated with the implications of tax distortions on the main elements of the Single Market. Ad hoc working groups would be set up under the Observatory to study specific problems and issues that may arise from time to time and to propose solutions thereto.

| 4.10 | It is the opinion of the EESC that simplified procedures will enhance efficiency as the process of acquiring information and understanding the rules will be made more clear and understandable for EU citizens. Appropriate information must be available to better support the citizens to meet their obligation at law to pay in the due manner the taxes which are due. |
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4.10

It is the opinion of the EESC that simplified procedures will enhance efficiency as the process of acquiring information and understanding the rules will be made more clear and understandable for EU citizens. Appropriate information must be available to better support the citizens to meet their obligation at law to pay in the due manner the taxes which are due.

| 4.11 | At the same time, the EESC strongly believes that any opportunities to combat tax evasion which may be presented through these measures should be made use of. |
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4.11

At the same time, the EESC strongly believes that any opportunities to combat tax evasion which may be presented through these measures should be made use of.

| 4.12 | The need to establish the Cross-Border Taxation Observatory is urgent as there is substantial evidence that without immediate action the problem will continue to grow with serious economic and social consequences rather than diminish. The EESC therefore recommends that in the first instance the Observatory is established and operates under the auspices of the Commission. It is recommended that the Commission assigns to it the specific authority and responsibilities and resources that will enable the Observatory to effectively execute the functions entrusted to it and as defined in this opinion. The EESC, however, strongly recommends that in the shortest time possible the Cross-Border Taxation Observatory is established as a Policy Agency with full legal personality under public law. This legal status would ensure that the Observatory can be completely independent and operate without any bias. The Observatory as a Policy Agency would qualify for the allocation of specific resources necessary to execute the functions entrusted to it. |
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4.12

The need to establish the Cross-Border Taxation Observatory is urgent as there is substantial evidence that without immediate action the problem will continue to grow with serious economic and social consequences rather than diminish. The EESC therefore recommends that in the first instance the Observatory is established and operates under the auspices of the Commission. It is recommended that the Commission assigns to it the specific authority and responsibilities and resources that will enable the Observatory to effectively execute the functions entrusted to it and as defined in this opinion. The EESC, however, strongly recommends that in the shortest time possible the Cross-Border Taxation Observatory is established as a Policy Agency with full legal personality under public law. This legal status would ensure that the Observatory can be completely independent and operate without any bias. The Observatory as a Policy Agency would qualify for the allocation of specific resources necessary to execute the functions entrusted to it.

| 4.13 | Focus on the removal of tax barriers is required irrespective of decisions regarding tax harmonisation. The latter may theoretically be viewed as one of the criteria required for a Single Market, at least in the indirect tax area, but it is in practice an extremely challenging objective that furthermore may be in conflict with other fundamental objectives of the European Union. For this reason, it is even more important to focus on the removal of tax obstacles to cross-border situations in order to contribute to the realisation of the objectives of the Single Market. Efforts aimed at the removal of tax obstacles for cross-border business are deemed to complement and be complemented by a number of important on-going initiatives, not least those regarding the EU2020 process and the Small Business Act. |
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4.13

Focus on the removal of tax barriers is required irrespective of decisions regarding tax harmonisation. The latter may theoretically be viewed as one of the criteria required for a Single Market, at least in the indirect tax area, but it is in practice an extremely challenging objective that furthermore may be in conflict with other fundamental objectives of the European Union. For this reason, it is even more important to focus on the removal of tax obstacles to cross-border situations in order to contribute to the realisation of the objectives of the Single Market. Efforts aimed at the removal of tax obstacles for cross-border business are deemed to complement and be complemented by a number of important on-going initiatives, not least those regarding the EU2020 process and the Small Business Act.

Brussels, 14 July 2011.

The President of the European Economic and Social Committee

Staffan NILSSON

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(1)  COM(2010)2020final

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(2)  COM(2010)769 final

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(3)  COM(2005) 261 final.

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(4)  COM(2009) 557 final and SEC(2009) 283 final.

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(5)  In 2004 the Commission proposed a ‘one-stop shop’ system (COM(2004) 728) that would allow certain Reporting obligations to be met in the Member State where the business is established. However, the proposal has not yet been adopted.

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(6)  COM(2010) 695 final.

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(7)  COM(2009) 201 final.

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