The European Commission is considering reducing the scope of a proposed tax on large companies aimed at generating new revenue for the European Union’s next seven-year budget, as it faces resistance from member states and business groups.
The so-called Corporate Resource for Europe (CORE) would impose an additional 0.1% levy on companies operating in the EU with net turnover above €100 million. However, critics, including the European People’s Party, business organisations and several national governments, argue the measure could harm European competitiveness and unfairly target firms based on revenue rather than profits.
To secure approval, the Commission is exploring exemptions for less profitable companies and raising the threshold to exclude more small and medium-sized enterprises. Officials warned, however, that such changes could reduce expected revenues without addressing wider concerns.
The issue is among the most difficult in negotiations over the EU’s next budget, as Brussels seeks new “own resources” to help finance rising defence and competitiveness spending and repay post-pandemic debt.
The European Parliament has also entered the debate, proposing alternative revenue sources including levies on online gambling, cryptocurrency firms and digital companies.
EU countries must unanimously approve any new EU-wide taxes. Ireland, which currently holds the rotating EU Council presidency, is reviewing which of the proposed measures have the strongest support ahead of a leaders’ summit in October.
The Commission is expected to revise revenue estimates later this year, while governments have already reduced the proposed budget size by 2%, giving some flexibility to scale back funding expectations from new taxes.
via Euronews
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