Common corporate tax base (CCTB) [EU Legislation in Progress]

Written by Gustaf Gimdal (1st edition),

corporate tax, 3D rendering, text on wooden sign

© laufer / Fotolia

The European Commission has decided to re-launch the common consolidated corporate tax base (CCCTB) project in a two-step approach, with the publication of two new interconnected proposals on a common corporate tax base (CCTB) and a common consolidated corporate tax base (CCCTB). These were published on 25 October 2016, and the 2011 CCCTB proposal (COM(2011) 121) was withdrawn on the same day. The re-launch follows the lack of progress on the 2011 proposal in the Council.

The 2016 CCTB provides for the determination of a single set of rules for calculation of the corporate tax base. Companies operating across borders in the EU would no longer have to deal with 28 different sets of national rules when calculating their taxable profits. The intention is that the proposed CCTB is a step on the way towards re-establishing the link between taxation and the place where profits are made, via an apportionment formula to be introduced through the new CCCTB proposal. The proposals include a number of anti-tax avoidance measures.

The proposal only concerns the corporate tax base and is not intended to harmonise national corporate tax rates. The Member States would retain their sovereign right to set their own tax rates.



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