Will they free themselves from a European directive regarding the minimum tax on multinationals? Five states of the European Union (France, Germany, Spain, Italy and the Netherlands) said they were ready on September 9 to implement the minimum tax of 15% on the profits of multinationals making more than 750 million euros in turnover from 2023. And this even if Hungary continues to block the measure at the level of the European Union authorities.
“If unanimity (within the Twenty-Seven) should not be reached in the coming weeks, our governments are (…) ready to implement minimum taxation in 2023 and by all legal means possible”, they declared in a joint text. The five signatories plan to go through a national route if the European route is obstructed. According to them, such a tax would constitute a “essential lever” to strengthen the ” justice “ tax “thanks to a more effective fight against tax optimization and tax evasion”.
150 billion additional revenue
The principle of this tax was approved in October 2021 by nearly 140 countries, including Hungary, under the aegis of the OECD. It had taken five years of debate to come to this. According to the OECD, the countries concerned, which represent 90% of world GDP, could generate around 150 billion euros in additional revenue thanks to this tax.
No large company could then pay less, wherever it is located. This would render useless the practice of lodging profits in subsidiaries located in tax havens.
Turnaround due to war in Ukraine
Problem: a unanimous vote of the Twenty-Seven of the European Union remains essential to validate a directive in this sense, a directive prepared in fact by Brussels. The latter had first been blocked for months by Poland, which finally lifted its opposition. But Hungary, which had agreed in a vote in early April, vetoed it in June, citing the impact of the war in Ukraine on the economy.
According to observers, Budapest is suspected of pushing for a green light from the EU for its recovery plan, endowed with 7.2 billion euros in subsidies, still blocked due to an insufficient fight against corruption.