he French car-service company Heetch recently displayed an advertising campaign on the streets of Paris (see photo), which proudly affirmed its presence in many French cities but not in Luxembourg—a clear allusion to the tax headquarters of some of its competitors. The fact that ‘paying taxes in France’ has become a commercial argument shows that the issue of corporate avoidance is rising up the public agenda in many countries.
Yet the G20 process on taxing digital firms and introducing a global minimum tax to limit tax competition, led by the Organisation for Economic Co-operation and Development, failed to reach consensus in 2020, mostly because of determination by the United States to protect its digital giants. The European Commission has made clear that, were the G20 to fail to deliver a global solution by mid-2021, it will act. But the EU is stuck between a rock—the US position will likely not change with the new administration—and a hard place: its own tax havens.
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EU taxation of multinationals—bypassing the unanimity blockage – Tommaso Faccio and Francesco Saraceno
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