ETAF annual report 2022
The European Tax Adviser Federation (ETAF) published on Thursday 16 March its annual report presenting its main activities in 2022. In this edition, we put the spotlight on our work on the upcoming legislative proposal to tackle the role of “enablers” that facilitate tax evasion and aggressive tax planning (“Securing the Activity Framework for Enablers” or SAFE), the Anti-Money Laundering package, the implementing Directive for Pillar 2, the proposal for a Directive to prevent the misuse of shell entities for tax purposes (UNSHELL), the VAT in the digital age package, the proposal for a debt-equity bias reduction allowance (DEBRA) and a future common EU-wide system for withholding tax on dividend or interest payments. “ETAF is – and will be – the European advocate of regulated tax advisers towards the European institutions. We speak up for appropriate and balanced tax rules, support the modernisation of the international tax system and defend strong, independent and regulated tax professions in Europe”, ETAF President Philippe Arraou said in the foreword.
BStBK’s survey “Tax professions in Europe”
From June 2022 to January 2023, a German member of the European Tax Adviser Federation (ETAF), the Bundessteuerberaterkammer (BStBK), conducted a Europe-wide survey on the regulation of tax advisory professions in Europe. 23 professional organisations from 21 different countries participated. The aim of the survey was to provide a comprehensive picture of the existing landscape of professional regulations in Europe in order to identify overlaps and common grounds. Participating organisations were asked about general professional characteristics, conditions of access to the profession, organisational structures, existing registration requirements, the framework of exercising the profession, professional obligations as well as supervision and possible sanctions. The results clearly show that the landscape of tax advisory professions in Europe is very broad and differentiated. Nevertheless, the authors also found that in many countries there are more regulatory systems than often assumed. The regulatory approaches studied range from a (voluntary) membership in a professional organisation, which usually requires a certain level of education and the compliance with a professional Code of Conduct, to the protection of a title or licence (by law) and reserving tax advisory activities to a certain profession. The results shall feed the current public debate around the regulation of the tax advisory profession in Germany as well as on the European and International levels.
Results of ECOFIN meeting on 14 March
EU Finance Ministers met in Brussels on Tuesday 14 March to discuss how the Recovery and Resilience Facility and REPowerEU can effectively contribute to the green transition and ensure Europe’s independence from Russian energy sources in the context of high inflation and supply chain disruptions. They also exchanged views on the economic and financial impact of Russia’s aggression against Ukraine. Moreover, the Council of the EU agreed conclusions on orientations for a reform of the EU economic governance framework. The conclusions contain areas of convergence of views among member states and areas for further work on a reformed framework. No tax files were discussed during the ECOFIN meeting.
Over 130 MEPs and observers call for a global extreme wealth tax
Over 130 members of the European Parliament, economists, millionaires, and representatives of non-governmental organizations called on Tuesday 14 March the OECD and the UN to launch a round of negotiations on the taxation of extreme wealth. The op-ed was written by French MEP Aurore Lalucq and French economist Gabriel Zucman and published in French in Le Monde and in English in Agence Europe. It calls for the introduction of a progressive tax on the wealth of the ultra-rich in order to reduce inequalities while financing the necessary investments for the ecological and social transition. It does not prescribe any model but says that it could also be implemented at the European level with an exit tax applied by a group of voluntary countries and mentions the existing academic proposals for a tax of 1.5% for those with over $50 million. “136 countries and jurisdictions reached an agreement through the OECD, to ensure that Multinational Enterprises (MNEs) would be subject to a minimum tax rate of 15%. Quickly after, the EU adopted a directive to effectively implement this minimum tax rate at the European level. What we managed to do for multinationals, we must now achieve for the very wealthy individuals”, the op-ed says. The list of signatories can be consulted here.
OECD public consultation meeting on compliance and tax certainty aspects of global minimum tax
On Thursday 16 March, the OECD held a public consultation meeting on the compliance and tax certainty aspects of global minimum tax (so-called Pillar 2). On this occasion, stakeholders raised broader concerns about Pillar 2 rules, with some reportedly calling for publication of additional administrative guidance as implementation issues arise. Many stakeholders reportedly expressed support for a mandatory binding dispute resolution mechanism, which would require a multilateral convention. Others also supported improving existing tools in domestic law and treaties to address disputes on an interim basis. Concerning the GLOBE information return, the need to simplify and reduce the number of data points as much as possible was often pointed out. Many stakeholders also called for a one-stop shop approach for filing returns. The meeting can be watched again online here.
FATF new guidance on beneficial ownership of legal persons
In March 2022, the FATF agreed on tougher global beneficial ownership standards in its Recommendation 24 by requiring countries to ensure that competent authorities have access to adequate, accurate and up-to-date information on the true owners of companies. On Friday 10 March, the FATF indicated that it has now updated the guidance that will help countries implement the revised Recommendation 24. The guidance will help countries identify, design and implement appropriate measures in line with the revised Recommendation 24 to ensure that beneficial ownership information is held by a public authority or body functioning as a beneficial ownership registry, or an alternative mechanism that enables efficient access to the information, it explained. The guidance explains types and sources of relevant information, and mechanism and sources to obtain such information. This includes the multi-pronged approach, which consists of combining information from, among others, companies themselves, public authorities in a registry, or alternative mechanism if it ensures rapid and efficient access to beneficial ownership information.
This newsletter contains information about European tax policies and developments gathered from official documents, hearings, conferences and the press. It does not reflect the official position of ETAF nor should it be taken as a written statement on behalf of ETAF.