OREANDA-NEWS. February 01, 2016. Mesdames et Messieurs,

This brings me to my next point: We will not stop cross-border tax avoidance with 28 national responses. A patchwork approach does not match the multiple challenges of our XXIst century tax systems. So a coordinated approach in the EU is essential to succeed. In our Single Market, to leave the national level implementing measures without coordination can create burdens for businesses, uncertainty for investors and even more new loopholes for tax avoiders to exploit. This coordinated EU approach we are reinforcing today will be more effective in stopping avoidance and will create a much fairer and more stable environment for businesses.

Until now, Member States that make great efforts to fight abusive tax practices are being undermined by those that take a more lenient approach. Some struggle to enforce their national tax rules, simply because others have more "avoidance friendly" regimes. 

This cannot go on anymore. It is too easy for companies to lower their tax bills by playing with financial interest deductions if not all Member States have a limit on this deductibility. It is too easy for companies to escape taxation by shifting assets to tax havens, if not all Member States apply exit taxation. Today's we take action to put Member States on an equal footing when it comes to protecting their tax bases – by setting legally binding rules that they all must apply. The important word is all of them.  This means that Member States will all have to apply a minimum level of protection against avoidance, which will safeguard the Single Market as a whole.

This common EU approach will strengthen our collective defence against corporate tax abuse and will ensure fairer taxation across the entire Union. Let me be clear on one point: coordination does not mean minimum taxation. Member States can still choose their own corporate tax rates, so long as they respect fair tax competition.

Crucially, a coordinated EU approach will improve the Single Market for business too. Because, and I stress this: This anti-avoidance package is also a pro-business package. Europe's tax environment must remain attractive for business – this is critical for growth, for jobs, for investment, and you know this is the priority of this Commission. We want a strong and healthy Single Market, where businesses can thrive. We want simple and stable tax systems – that are appealing to investors and that are manageable for start-ups. And we want all businesses to enjoy fair competition and equal treatment when they operate within the EU.

Today's Package will help to deliver on all of these goals. It will remove legal uncertainties and administrative burdens, created by divergent national rules against avoidance, as these will no longer exist. It will minimise the risk of double taxation for cross-border businesses, so that they pay their fair share of tax – but no more. And it will guarantee a level playing field for all companies in the EU – whether they are headquartered here or not. This last point is in my view an important one. Our measures – I insist on that - are not directed at EU businesses alone. They are designed to ensure that any company that benefits from the Single Market – whether it is EU, US, Asian or other – pays fair tax on the profits they make here. This is the principle of effective taxation and it is the basis of all our reasoning and all our actions.

In the same spirit, countries that enjoy an economic relationship with the EU must also respect the rules of fair corporate taxation. Tax avoidance is a global problem, which is addressed by the G20 after the OECD recommendation, and the response must be global too.

The EU cannot be alone in its corporate tax reforms. Last November, over 100 countries agreed to implement the OECD's action plan against Base Erosion and Profit Shifting, or BEPS. This is an initiative of which I am supportive since the beginning. When I was in a previous capacity as finance minister of France I helped launch it, and I supported it, crucially. They pledged to create fairer tax systems and to close loopholes that allow profit-shifting. Our Member States are already delivering on these commitments. And today's Package completes the framework for the smooth and swift implementation of BEPS in the EU. Now we must ensure that others do the same – to prevent external threats of base erosion and to safeguard EU competitiveness.

Today we are presenting in the package a new External Strategy for Effective Taxation to work with our international partners for a better taxation considered globally. Cooperation and dialogue are at the heart of this Strategy. We will make better use of the instruments we have as a Union – from agreements with third countries to development aid – to build stronger global partnerships on tax matters. But if this doesn't work, we should not be afraid – and my colleagues and I won't be afraid - to "name and shame".  Therefore, we will put in motion a common EU listing process to deal with jurisdictions outside the EU that refuse to play fair. This process will be neutral, clear and well-founded.

This listing process will be based on a three steps approach: First, the Commission will identify the third countries that should be prioritized for screening, based on a scoreboard of common indicators. Second, Member States will decide which countries should be screened by the EU, based on the scoreboard results. We will engage in a dialogue with each third country being screened. Third, and last, based on these results, Member States will decide whether to add a country to the EU list and will set clear conditions for de-listing. So this process will be objective, transparent and based on dialogue, leading to decision. Unlike the current medley of national lists - we did that and we were right to do so but we knew and I knew the limits of the exercise - the common EU list that we decide to launch today will be based on clear good governance criteria and a fair and coherent assessment process.  I believe that we have set here the right approach, up to the challenges.