Finance directors, tax directors and tax managers from over 400 companies, including some of the largest companies from all 27 EU countries and Switzerland, were asked their view of European Commission plans for a common consolidated corporate tax base (CCCTB).
The plans propose that the profits of businesses operating in more than one EU Member State should be calculated according to a single EU-wide formula, rather than the 27 different formulae used today. Profits would then be reallocated to the countries in which the businesses are active, to be taxed at those countries' tax rates.
Among the large economies, the UK, was most sceptical, with 62% in favour and 32% against. Only Ireland and Slovakia registered majorities against the proposal, with 50% opposed in each country. However, the idea found greater support in the other European countries.
For example, tax professionals in the Czech Republic, Denmark and Spain were 100% in favour, along with 96% in Italy, 90% in Greece, Luxembourg, Poland, Romania, Slovenia and Sweden, 84% in Germany and 80% in Austria, Finland, Hungary and Portugal.
The Commission has stressed that it is not proposing a single European corporate tax rate and, in this respect, the UK, Cyprus, Ireland, Poland and Switzerland recorded majorities against a single rate. Denmark was evenly split for and against, but in all other countries there was strong support for the idea.
Businesses were attracted by the prospect of more straightforward tax compliance and better business planning. While 22% thought the new system could increase the amount of tax their business pays, this was balanced by 21% who thought their tax bills would fall, and 42% who thought it would make little difference.
The proposals are due to be made public in 2008, and the Commission hopes that they will be in place by 2010. Many respondents thought that this timetable was optimistic, although only 15% said that it would never happen.
Further information on the consolidated tax base can be found at http:snipurl.com/ccctb
