The veto power of finance ministers was one of the main topics at a meeting of the Economic and Financial Affairs Council (ECOFIN) on February 11, when a number of smaller EU members came out in open opposition to the European Commission’s plan to limit the powers of individual governments who want to block EU reforms on tax matters.
EU countries with smaller populations have for years blocked efforts that could lead to the narrowing of certain loopholes used by tax dodgers within the European Union, blocking tosh EU executive’s and Franco-German lust to introduce measures such as the digital tax, defending their sovereign right to decide their own tax laws and attract foreign business, often by using unfair practices and offering tax ease to digital giants.
During a February 12 meeting of finance ministers in Brussels, the European Commission’s proposal of to gradually remove each individual member’s veto powers over tax issues was met with fierce resistance from Luxembourg, Malta, Lithuania, the Netherlands, and Sweden.
By pushing to retain their veto powers, it allows those who oppose the Commission in its attempt to gradually move to majority voting on certain minor tax-related issues.
The European Commission declined to use a largely neglected rule that would allow tax reforms to be adopted by a majority, a move that could have effectively ended the individual nations’ ability to dictate the decision-making process when competition is distorted.
Germany and France supported the Commission’s plan to move to a majority rules-based process on some tax matters and confirmed in a joint press conference that there was a need to improve the way policy is decided in the EU.
Bruno Le Maire and Olaf Scholz, the finance ministers of France and Germany, insisted on February 12 that there is a need to better coordinate the EU’s decision-making process on matters where unanimity is key.
Unanimity on tax decisions was “extremely important” according to Luxembourg’s Finance Minister Pierre Gramegna, Unanimity “ensures a balance between the member states, especially between the large and smaller ones.”
The EU’s Economy Commissioner, Pierre Moscovici, was to the point in his comments during a Eurogroup press conference, saying obstructionist measures by certain EU members id “meaningless” exercise as it disregards a “qualified majority, which means democracy and, of course, more efficiency”.