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Brussels, 2 May 2007

Company taxation/Common Consolidated Corporate Tax Base: The European Commission presents a progress report on the preparatory work made before finalising its proposal due in 2008

Following a first progress report in 2006 (IP/06/448), the European Commission has adopted a second Communication on the progress towards a Common Consolidated Corporate Tax Base (CCCTB). The Commission, in this Communication draws the attention of the other EU institutions to the work that has been done and the work that has to be done at experts level, identifying the problems and the possible options to solve them, before making a formal proposal in 2008. The CCCTB would enable companies to follow the same rules for calculating the tax base for all their EU-wide activities, rather than in accordance with the existing 27 systems, thereby, simplifying procedures, improving efficiency and reducing compliance costs (IP/04/1091). The consolidated tax base would be distributed between Member States in accordance with an agreed fair sharing mechanism which will also form part of the proposal. Member States will retain full sovereignty over their tax revenues as they will continue to set their own national tax rates. The Commission confirmed that it will not make any proposal on harmonizing tax rates.

"I am very pleased with the work already achieved and thank the Member State experts for their active participation and input. We are now entering the crucial phase where technical fine tuning and strong political support are needed", László Kovács, the Commissioner for taxation and customs union, said. "I know this project is an ambitious one and has raised some scepticism from certain Member States and questions that are to be answered. I expect all the stakeholders in favour of the project to advocate the CCCTB as the solution to eliminate existing fiscal obstacles throughout the European Union, help companies to improve their competitiveness and make Europe a more attractive place to do business.”

Why a Common Consolidated Corporate Tax Base?

The CCCTB constitutes a comprehensive solution to tackle in one go all the company tax obstacles arising when companies carry out cross border activities within the Internal Market.

Indeed, in addition to reducing compliance costs for companies operating across the Internal Market, the CCCTB will eliminate many of the existing intra-community transfer price difficulties, allow cross-border loss offsetting, simplify many international restructuring operations and avoid many situations of double taxation. It will contribute to greater simplicity and transparency in the 27 existing company tax systems, thereby promoting fair and open tax competition within the European Union. The European Commission has no intention to link the CCCTB with any proposal to harmonise tax rates.

The Commission advocates that:

  • The CCCTB should be broad, simple and uniform with as few exceptions as possible;
  • The tax base could be consolidated and optional for companies.

This communication highlights the necessity to elaborate issues like:

  • the extent to which, and manner in which, the financial sector should be incorporated into the CCCTB from its inception,
  • the administrative framework of the CCCTB, in particular how cooperation and mutual assistance can be improved and how the necessary new working methods at Community level can be introduced.


The Commission's tax policy is an integral part of its comprehensive strategy to create more growth and jobs in the EU and to boost the competitiveness of EU companies.

The Commission concentrates on the improvement of a more favourable tax environment so that business and citizens can benefit from the full potential of the internal market. Attracting investment can be done in many ways and taxation plays a part in this.

The CCCTB constitutes a comprehensive solution to remove tax obstacles that EU companies face when operating in several Member States.

Further information on the Common Consolidated Corporate Tax Base is available on the following website:

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