"Romania supports all measures to combat fiscal planning. We believe that this project [for minimum effective taxation of profits of Multinational Enterprises] will help ensure fair competition in the EU internal market. The adoption and implementation of the directive is a priority for Romania as well, so we will prepare all necessary measures for its implementation as quick as from January 1, 2023," finance minister Adrian Câciu said, quoted by Bursa.ro.

The proposal for a Directive on the minimum level of taxation for Multinational Enterprises [MNEs] in the European Union was the most important topic on the agenda of the Economic and Financial Affairs Council (Ecofin) held on Tuesday, January 18, in Brussels. The Ministers of Finance were invited to confirm, at the political level, the priority of this file and the need to transpose into EU law, by January 1, 2023, the international rules agreed in the Inclusive Framework of the Organization for Economic Co-operation and Development (OECD).

The OECD/G20 Inclusive Framework on base erosion and profit shifting (BEPS) is working on consensus-based, long-term solutions to the tax challenges arising from the digitalisation of the economy. During its 29-30 January 2020 meeting, it decided to move ahead with a two-pillar approach. The first pillar focuses on solutions for determining the allocation of taxing rights ("nexus and profit allocation"). Under a second pillar, a system to ensure that MNEs pay a minimum level of tax on profits is being designed. 

In May 2021, the European Commission published the Communication on Business Taxation for the 21st Century. The Communication set out a long-term vision to provide a fair and sustainable business environment and EU tax system, building on the progress made and the principles agreed in the global discussions. It also sets a tax agenda for the next two years, with targeted measures that promote productive investment and entrepreneurship and ensure effective taxation.

andrei@romania-insider.com

(Photo source: Gov.ro)