The EU Tax Commissioner, Mr Laszlo Kovacs visited Dublin on 24 February.

Mr Kovacs was most emphatic that while there may be no plans to harmonise Corporation Tax rates across the EU, he is hoping to achieve harmonisation of the corporate tax base (within the terms of the project known as the Common Consolidated Corporate Tax Base – CCCTB). He commented that if the Commission cannot get unanimity on the matter, he is prepared to adopt a twin track approach. Mr Kovacs feels that 20 of the EU Member States are in favour of the proposals, which in effect would result in six methods of arriving at the tax base across the EU – one common base for twenty countries, along with another five. Mr Kovacs envisages that the CCCTB could be optional for groups of companies – they could elect to move within the CCCTB. Whether such an election would be irreversible has not been decided.

Mr Kovacs also stressed his desire to see VRT harmonised. He said harmonisation of VRT would be more friendly both to the manufacturer and the consumer, as it would eliminate the possibility of double taxation where the customer moved across jurisdictions. A possible way of maintaining the revenue yield which could be lost through harmonisation might be to roll the charge in to annual charges applied by Member States on motorists – motor tax. He also expressed a view that motor taxes should in the future incorporate some element of taxation computed by reference to greenhouse gas emissions.