The Institute attended the Federation of European Accountants (FEE) Tax Policy Roundtable discussion on the Common Consolidated Corporate Tax Base (CCCTB) in Brussels last month. Speakers included representatives from the European Commission and European Policy Centre. The message was clear: CCCTB has two purposes; the first to tackle anti-avoidance and secondly to simplify business for EU groups.

While the proposals were previously put forward and rejected in 2011, the Commission is confident that the updated proposals by way of a two-step approach will be more acceptable to Member States. The first stage will be implementation of the Common Corporate Tax Base (CCTB) which requires all member states to calculate their taxes in the same manner (the common base). The second stage, being the CCCTB, will see a consolidated tax return prepared for all companies within each Member State. Once the tax base has been established, the company’s taxable profits will be shared out between the Member States in which the company is active using an apportionment formula.

The Commission is confident that agreement will be reached but this will require acceptance by all Member States. For countries like Ireland, the second stage could be particularly damaging in attracting foreign investment.