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Commission presents action plan for fair and efficient corporate taxation in the EU
The Commission has presented an Action Plan to fundamentally reform corporate taxation in the EU. The Action Plan presented on 17 June sets out a series of initiatives to tackle tax avoidance, secure sustainable revenues and strengthen the Single Market for businesses. Collectively, these measures will significantly improve the corporate tax environment in the EU, making it fairer, more efficient and more growth-friendly. Key actions include a strategy to re-launch the Common Consolidated Corporate Tax Base (CCCTB) and a framework to ensure effective taxation where profits are generated. The Commission is also publishing a first pan-EU list of third-country non-cooperative tax jurisdictions and launching a public consultation to assess whether companies should have to publicly disclose certain tax information. These initiatives build on measures already set out in the Tax Transparency Package, which the Commission presented in March, and are in line with on-going work at the OECD to limit tax base erosion and profit shifting.
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The Commission has today laid the foundation for a new approach to corporate taxation in the EU. Member States must now build on it.
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Pierre Moscovici
, Commissioner for Economic and Financial Affairs, Taxation and Customs
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Portugal post-programme surveillance finds economy improving but held back by remaining macroeconomic imbalances
Staff from the European Commission, in liaison with staff from the European Central Bank, visited Portugal from 4-12 June to conduct the second post-programme surveillance (PPS) mission. This visit also served as specific monitoring in the framework of the EU Macroeconomic Imbalance Procedure. Economic activity in Portugal is gradually recovering and has become more broad-based. It has also been supported by lower oil prices, a weaker exchange rate, improved financing conditions and improved business and consumer confidence. Improving economic growth and more favourable borrowing conditions are also supporting public finances. Moreover, structural reforms undertaken during the financial assistance programme are increasingly having an effect. Nevertheless, the economic recovery continues to be held back by the remaining macroeconomic imbalances. The reform agenda to further enhance medium-term growth prospects, job creation and competitiveness remains challenging.
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G7 leaders reaffirm commitment to sustainable, inclusive growth that protects the climate
Under the motto 'Think ahead, act together', the G7 Summit took place from 7-8 June in Schloss Elmau, Germany. The EU was represented by Jean-Claude Juncker, President of the European Commission, and Donald Tusk, President of the European Council. G7 leaders noted that economies are still operating below their full potential and that unemployment is still too high in many countries. They committed to addressing these and other challenges, and to continuing efforts to achieve inclusive growth. They also agreed to continue to implement fiscal strategies flexibly to take into account near-term economic conditions, while putting debt as a share of GDP on a sustainable path. The G7 leaders reaffirmed their intention to promptly implement agreed financial reforms and strengthen regulation and oversight of the shadow banking sector. They recognised that putting the world on a sustainable growth path in the long run will require the protection of the climate, the promotion of health and the equal participation of all members of society.
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European Commission disburses EUR 10 million in financial assistance to the Kyrgyz Republic
On 11 June, the European Commission disbursed EUR 10 million in grants to the Kyrgyz Republic as part of the EU Macro-Financial Assistance (MFA) for the country. This amount is part of the first tranche of the EUR 30 million MFA programme that the EU approved in October 2013. The MFA takes the form of a grant of EUR 15 million and a medium-term loan of EUR 15 million. On 22 May 2015, the European Commission approved disbursement of the EUR 5 million loan element of the first tranche, which will also be released shortly. The objective of the assistance is to help the Kyrgyz Republic to alleviate its balance of payments needs and thereby support its economic and social development. It complements the assistance that the International Monetary Fund (IMF) provides in the context of the Stand-By Arrangement approved by the IMF on 8 April 2014.
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Investment Plan for Europe: Vice-President Katainen continues road show with visits to Slovakia and Austria
European Commission Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness, visited Bratislava, Slovakia on 15 June and Vienna, Austria on 16 June as part of his road show to promote the EUR 315 billion Investment Plan for Europe. In Bratislava, Vice-President Katainen met Prime Minister Robert Fico, and Deputy Prime Minister and Minister for Finance Peter Kazimir. He also spoke at a symposium on investment entitled "Boosting investment in Slovakia and the EU" at the Slovak Chamber of Commerce, and met with investors and with members of the Slovak National Parliament. Slovakia announced on 15 June that it would contribute EUR 400 million to projects financed by the European Fund for Strategic Investments (EFSI), the heart of the Investment Plan. In Vienna, Katainen made a speech at the Vienna University of Economics and Business, and met with Vice-Chancellor Reinhold Mitterlehner, and Social Affairs Minister Rudolf Hundstorfer, as well as Austrian political and business leaders. Vice-President Katainen is meeting Heads and Members of Government, business leaders, SMEs, investors and students as part of the 28-country road show to promote and explain the Investment plan. The road show can be followed in detail on Twitter.
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Vice-President Dombrovskis visits Portugal to discuss the European Semester and on-going reforms
Valdis Dombrovskis, Vice-President for the Euro and Social Dialogue, visited Portugal on 12 June to discuss the European Semester of economic policy coordination and reforms underway in the country. The Vice-President met with Prime Minister Pedro Passos Coelho, President of the National Parliament Assunção Esteves, Minister of Solidarity Employment and Social Security Pedro Mota Soares, and Minister of State and Finance Maria Luís Albuquerque. He also exchanged views with several parliamentary committees and with social partners. The Vice-President is visiting Member States as part of the Commission's outreach on the European Semester. It takes place on the basis of the country-specific recommendations published by the Commission in May. During these visits, Vice-President Dombrovskis engages national authorities and social partners in a constructive discussion on the issues raised in the recommendations. After Portugal, the Vice-President’s next European Semester visit will be to Sweden on 29 June.
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European Court of Justice rules that ECB Outright Monetary Transactions are compatible with EU Treaty
On 16 June, the European Court of Justice (ECJ) confirmed the legality of the European Central Bank (ECB) bond-purchase scheme on secondary markets. The scheme, known as Outright Monetary Transactions (OMT), was announced by the ECB in September 2012. The Commission welcomed the ECJ decision as it fully confirms the compatibility of the OMT with the EU Treaty on the Functioning of the European Union. The Court’s decision closely follows the reasoning set out by the ECB and the Commission, regarding both the qualification of the OMT as a monetary policy measure and its compatibility with the prohibition on monetary financing. The ruling also reaffirms that ECB intervention on the secondary markets to purchase government bonds from certain euro area countries must be accompanied by sufficient safeguards to ensure that the prohibition on monetary financing is fully respected. The OMT as designed by the ECB does contain the necessary safeguards to this effect.
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May 2015: Annual inflation up to 0.3% in both the euro area the EU
Euro area annual inflation was 0.3% in May 2015, up from 0.0% in April. In May 2014, the rate was 0.5%. EU annual inflation was also 0.3% in May 2015, up from 0.0% in April. A year earlier the rate was 0.6%. These figures were released on 17 June by Eurostat, the statistical office of the EU. In May 2015, negative annual rates were observed in eight Member States. The lowest annual rates were registered in Cyprus (-1.7%), Greece (-1.4%) and Slovenia (-0.8%). The highest annual rates were recorded in Romania and Malta (both 1.3%) and Latvia (1.2%). Compared with April 2015, annual inflation fell in two Member States, remained stable in three and rose in 23. The largest upward impacts to euro area annual inflation came from vegetables (+0.09 percentage points), restaurants & cafés (+0.08 pp) and tobacco (+0.07 pp), while fuels for transport (-0.34 pp), heating oil (-0.15 pp) and gas (-0.08 pp) had the biggest downward impacts.
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GDP up by 0.4% in both the euro area and the EU
Seasonally adjusted GDP rose by 0.4% in both the euro area and the EU during the first quarter of 2015, compared with the previous quarter, according to a second estimate published by Eurostat, the statistical office of the EU. In the fourth quarter of 2014, GDP also grew by 0.4% in both areas. Compared with the same quarter of the previous year, seasonally adjusted GDP rose by 1.0% in the euro area and by 1.5% in the EU. Among Member States for which data are available for the first quarter of 2015, the Czech Republic (+3.1%), Cyprus and Romania (both +1.6%) recorded the highest growth compared with the previous quarter, followed by Poland (+1.0%), Bulgaria and Spain (both +0.9%), Hungary, Slovenia and Slovakia (all +0.8%). Decreases were registered in Lithuania (-0.6%), Estonia (-0.3%), Greece (-0.2%) and Finland (-0.1%). Household final consumption expenditure and gross fixed capital formation contributed positively to GDP growth, while the external balance contributed negatively in both the euro area and EU.
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Assessing economic reform programmes in the Western Balkans and Turkey
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The European Commission regularly reviews the economic situation and the economic reform needs of countries in the Western Balkans, and of Turkey, as these countries aspire to join the European Union.
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Directorate-General for Economic and Financial Affairs
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