02.06.2024 klo 17:40
World is changing, how does the taxation change? Maailma muuttuu - miten muuttuu verotus?
In an ever-evolving world, how does taxation keep pace with rapid transformations? Or whether taxation is the right way to implement the desired changes? This is the central question explored in the Minipodcast in which I was interviewed on the subject. : ”Maailma muuttuu – miten muuttuu verotus?” – World is changing, how does the taxation change? – produced by the Aalto EE, for business management. I highlight in the discussion three phenomena in global tax policy: harmonisation, digitalisation and the green transition.
- Tackling tax competition through harmonisation and reporting based on Pilar 2 and resent other global tax initiatives have played an important role in steering the taxation of large companies in particular in recent years. Legislation and regulation has been rushed out of the pipeline without much scrutiny. More legislation and reporting, but is it working? It is generally accepted that taxpayers who do their job well and complies with the rules, albeit at great cost and administrative burden? On the other hand, those who want to play their own game ignores the rules or keep playing dirty games no matter how much reporting is required. And you can always report, it’s a different thing what you report. I ask, would it be a good idea to stop rushing eyes closed for a moment and see if the new regulation works?
- Digitalisation is proposed to be introduced as a common tool to combat VAT fraud by moving to so called ”real-time” reporting in the EU. Of course, the legislator also promises to benefit businesses by easier reporting requirements. The new regulation also aims to clarify the taxation of businesses, including for services supplied through digital platforms. Again, a burdensome task, issue being somewhat along the same lines as above, expensive schemes for well-behaving taxable persons but will they help to catch the fraudsters? Not that sure. Compromise is expected in June’s Ecofin.
- Other indirect taxes, in turn, are on the lips of politicians and legislators when they talk about speeding up the green transition. For example, a compromise on the EU Energy Tax Directive has been sought for some time. Here again, harmonisation and a limitation of national derogations would be welcome, especially for Member States such as Finland and Sweden, where energy taxation already effectively implements different environmental objectives. Other countries should be included to collaborate soon as possible, but finding a compromise among the 27 Member States is not easy. It has to be however admitted that even Finland and Sweden have their own pain points in the negotiations. Time shows, if hard work brings at least some small consolation.
I discussed these issues and more with Anu Haapala in a podcast, which can be listened in Finnish.
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