EU taxation of multinationals—bypassing the unanimity blockage – by Tommaso Faccio and Francesco Saraceno

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.

Read more at: EU taxation of multinationals—bypassing the unanimity blockage – Tommaso Faccio and Francesco Saraceno

Hungary says it blocked EU budget over migration 'blackmail' - "which is total nonsense by Orban who destroyed Democracy in his country" said a European parliamentarian

Hungarian Prime Minister Viktor Orban said Wednesday his country vetoed the EU's budget over plans to tie funding to respect for the rule of law, as it amounted to "blackmailing" countries that oppose migration.

Read more at: Hungary says it blocked EU budget over migration 'blackmail'

The Netherlands: Government has wishy washy poicy in wearing masks

Some things are hard to get your head around, even in 2020. The Dutch reluctance to don face masks is one of them. When I brought my daughter to get tested for Covid-19 recently, I was shocked to find that most people waiting in line weren’t wearing face masks. The medical professionals taking the swabs were in full gear, but even the workers checking our details were maskless. This was, after all, a place you could (in theory) only walk into if you had symptoms. Even more shocking was the man who checked-in my other daughter and I at the drive-thru testing centre at Amsterdam RAI. I asked him why he wasn’t wearing a mask. He said he had been, mostly to protect himself against the car fumes, but his bosses told him to take it off. Why has the Netherlands been virtually alone among its European neighbours—and much of the world—in its reluctance to mandate masks? Read more at: Despite the government u-turn, the Dutch are still unwilling to wear masks - DutchNews.nl

Turkey′s Erdogan clamps down further on media amid corononavirus crises

The Turkish president seems to be using the coronavirus crisis as a pretext to get rid of the few critical media outlets left in his country. Opposition politicians and journalists fear a new spate of censorship.

Read more at;
https://www.dw.com/en/turkeys-erdogan-clamps-down-further-on-media-amid-coronavirus-crisis/a-53192898

TURKEY MUNICIPAL ELECTIONS: Opposition sweeping all the big cities with AKP trying to fiddle with the votes in Istanbul

"Turkey's main opposition candidate says 'very clear' he won Istanbul" -

Read more at:
http://www.reuters.com/article/us-turkey-election-chp/turkeys-main-opposition-candidate-says-very-clear-he-won-istanbul-idUSKCN1RC0UX

EU diplomats plot against Trump on Jerusalem - by Andrew Rettman

EU diplomats in the Middle East will try to undermine Donald Trump's plan to establish Jerusalem as Israel's capital.

The blueprint for the EU counter-measures was contained in a confidential report filed by EU states' ambassadors in East Jerusalem and Ramallah, in Israeli-occupied Palestine, after the US president, on 6 December, unilaterally recognised Israel's claim to the holy city.

Trump's decision was "a fundamental shift in US policy", the 49-page EU report, seen by EUobserver, said.

"This is the first time that one of the final status issues has been subject to a policy change by a third party since the … Oslo Accords [in 1993]," the report added.

EU leaders should send out a "common message", the text said, that Europe will "continue to respect the international consensus" that Jerusalem should be shared by Israel and Palestine in a two-state solution.

EU states should also "ensure that the location of their diplomatic missions remains in line with its provisions on location until the final status of Jerusalem is resolved," the report said, after Trump promised to move the US embassy from Tel Aviv to Jerusalem.

The EU report on Jerusalem is a yearly exercise meant to steer talks by ministers in Brussels.

The 2017 edition contained several new recommendations designed to hamper Trump's plan.

It urged EU capitals: to push their line on Jerusalem in all "bilateral and multilateral contacts" in 2018; to "unequivocally oppose" Israeli laws to alter the city's status; and to consider "development of further actions on distinguishing between the territory of the state of Israel and the occupied territories".

Previous EU actions included blocking grants for Israeli settler firms and publishing label guidelines for settler products in European retailers.

The 2017 report also called for "systematic media outreach in support of … [the] EU policy on Jerusalem".

It said high-level EU visits to the city should "ensure that logistics follow EU policy, e.g. through choice of hotel, change of transport between East and West", referring to Israeli-occupied East Jerusalem and Israel's West Jerusalem.

There was less violence in the city last year despite some "confrontations" between Palestinian protesters and Israeli police after Trump's announcement, the EU text noted.

Thirteen Palestinians and seven Israelis were killed in violent incidents in total in Jerusalem in 2017, compared to 23 people the year before, and 41 the year before that.

But Israeli settlers were seizing Palestinian land at a "record" pace "including in areas identified by the EU and its member states as [being] key to the two-state solution", the EU report warned.

Israel advanced plans for more than 3,000 housing units in East Jerusalem last year, it said.

This added to the 215,000 settlers who have moved there since Israel conquered it in 1967 to live among the 317,000 Palestinians who are still left.

"Developments in 2016 to 2017 indicate that the Israeli authorities are taking active measures to prepare for settlement expansion in [the E1] area," the EU ambassadors added, referring to a zone that would cut off East Jerusalem from the rest of the West Bank and cut the West Bank into two cantons if it fell into settlers' hands.

The EU said Israeli prime minister Benjamin Netanyahu had systematically ignored its appeals on the issue.

"International objections were met by more announcements [of settlement expansion]," the EU ambassadors said.

The diplomats painted a grim picture of life under Israeli occupation.

They spoke of Israel's "long-standing policy of political, economic, and social marginalisation" of Palestinians, which "worsened" last year and which caused the kind of "high levels of stress and depression" that were fertile ground for violence.

They condemned killings on both sides, but singled out Israeli soldiers for "excessive use of force".

They also said Palestinian economic activity in East Jerusalem halved over the past 10 years and that 75 percent of Palestinians now lived below the poverty line.

That figure rose to 84 percent among Palestinian children, half of whom dropped out of school.

"The city has largely ceased to be the Palestinian economic, urban, and commercial centre it used to be," the EU report said. 

Read more: EU diplomats plot against Trump on Jerusalem

The Netherlands: New government under pressure over dividend tax ' corporate blackmail' claims

Rutte:"Being good to corporations is good for Holland"

MPs have called on prime minister Mark Rutte to explain the new government’s decision to scrap the tax on dividends for a second time, amid mounting reports that Shell and Unilever put pressure on the coalition negotiators.

The move to scrap the tax, which will cost the treasury €1.4bn and only benefit foreign firms, was not included in any of the party manifestos and has been condemned by opposition parties.

Broadcaster NOS reported earlier on Thursday that it had been told Anglo Dutch firms Shell and Unilever and two other companies had urged the new coalition to scrap the tax. ‘There was a real threat that a couple of bigger Dutch firms would go to London,’

NOS correspondent Ron Fresen said. Shell and Unilever have headquarters in both the Netherlands and Britain and both have been considering their position in a post-Brexit economy. Shell said on Wednesday it welcomed the new government’s decision.

It has campaigned for the tax to be scrapped for at least 10 years. Unilever has said it will decide by the end of the year whether or not to keep its dual headquarter structure. The company has also said that it is pleased with all measures which strengthen the Netherlands’ position as an international business centre. Jobs

Prime minister Mark Rutte has said repeatedly that the measure is needed to keep jobs and to make sure the Netherlands remains an attractive location for foreign firms.

However, leading economists and the government’s own macro-economic think-tank CPB have also questioned the move. During Thursday’s debate, GroenLinks (Greens) popular  leader Jesse Klaver said the government had laid itself open to being ‘blackmailed’ by big companies.

Read more: New government under pressure over dividend tax 'blackmail' claims - DutchNews.nl

Turkey: could a pro-EU AKP insider overthrows Erdogan and make the Turkish referendum victory backfire for him in 2019

Turkish President Erdogan visiting the US from May 16

Al-Montor in an editorial questions if Turkey’s fractured opposition could unite and produce a leader like French presidential winner Emmanuel Macron, driven by shared apprehension over President Recep Tayyip Erdogan’s rule? Can the critical presidential election in 2019 mobilize the opposition against him?

It's possible on paper, for the constitutional changes narrowly approved in the April 16 referendum have changed the rules of the game. Under the proportional representation system of the outgoing parliamentary regime, removing Erdogan and the Justice and Development Party (AKP) from power was virtually impossible under existing political balances.  

The new rules, however, allow an abrupt change in the seat of power by offering ground for alliances in the second round of the presidential vote. In other words, the new constitutional order that Erdogan wanted so badly and ultimately obtained risks becoming a political trap for him.

This possibility has stirred heated debate in Turkey since the referendum, with the opposition encouraged by the first serious signs that Erdogan can be defeated. 

 Despite the unfair campaign conditions and allegations of electoral fraud, the “yes” camp came up with only 51% of the vote, about 10 fewer percentage points than the combined vote the AKP and its referendum ally, the Nationalist Movement Party (MHP), got in the general elections in 2015. In addition, the “no” vote prevailed in 17 major urban centers, including the country’s three biggest cities.

Thee fragility of Erdogan’s victory has given a boost to a gloomy opposition that expected a much worse outcome and animated the political scene. Veteran politician Deniz Baykal, former head of the main opposition Republican People’s Party (CHP) and still an influential parliament member, argued in a May 1 interview that the opposition should unite around a common candidate for the 2019 election, the first under the amended constitution.

If CHP chair Kemal Kilicdaroglu does not plan to run for president, he should consider stepping down to allow for a stronger mobilization for the polls, Baykal argued. In another surprise statement, he suggested that former President Abdullah Gul, once Erdogan’s right-hand man, could be considered a joint candidate for the “no” camp.

With his veiled affirmation of Gul — an AKP founder at odds with Erdogan — as a possible candidate to unite the opposition, Baykal put into words something that many have silently thought of as a way to stop Erdogan. The mere utterance of this prospect was enough to rattle AKP ranks.

Baykal’s suggestion for a leadership change in the CHP also rattled the main opposition, sparking an internal power struggle and calls for an extraordinary party convention. The party’s in-house conflicts and the issue of whom it will back in the 2019 polls suddenly became intertwined.

Even more importantly, the hard-pressed CHP leader made it clear that the search for alliances for 2019 had already begun. “It would be wrong to behave as if the entire 49% [of the ‘no’ vote] belongs to us and embark on determining a candidate accordingly,” Kilicdaroglu said in a May 9 address to fellow party members in the parliament, stressing that he had consulted with the heads of more than 50 civil society organizations and was planning to visit fellow party leaders to discuss the process.

Political activity on the opposition’s left will clearly increase in this framework. Yet, it is the conservative camp that will make any alliance against Erdogan relevant and strong. At the referendum, 10% of AKP voters defied Erdogan, voting against the amendments. Will this group expand ahead of 2019? And even more importantly, will it become politicized? Those are vital questions for the coming period that are simmering anew in conservative quarters following Baykal’s mention of Gul as a possible joint candidate.

AKP officials urged Gul to speak out and clarify whether he does intend to confront Erdogan in the presidential race, while Erdogan slammed the idea as an effort to sow discord in the AKP ranks.

True to form, Gul remained cautious, neither opening nor closing the door. Speaking on May 5, he reiterated that he was keeping away from active politics, but at the same time stressed his “responsibility to share his knowledge and experience for the sake of the country.”

The AKP’s first prime minister and president, Gul has remained an important figure for the party and Turkish politics since completing his presidential term in 2014. Having fallen out with Erdogan over his policies after 2013, Gul represents the reformist and liberal leaning of the AKP’s original philosophy. As such, he enjoys a certain sympathy in opposition quarters and stands a chance of luring support from across the political spectrum should he decide to challenge Erdogan in the presidential race. So far, the non-confrontational Gul has held back from speaking out about his differences with Erdogan and creating discord and division in the AKP. The main reason was probably his belief that he had little chance of prevailing over Erdogan.

But given the growing discontent among conservatives and former AKP heavyweights, Erdogan’s continued pursuit of one-man rule could now upset the equilibrium. In his May 5 remarks, Gul seemed to speak on behalf of a certain group and orientation. Referring to vicious attacks from pro-government quarters, he said, “I condemn the unmentionable words and the foul language used against the AKP's real pioneers and founders and the unethical behavior within the party. Everybody now knows how this is being orchestrated.” Alluding to Erdogan, he expressed regret at “the silence in the face of all this.”

If an alliance emerges spontaneously around him, the possibility of Gul making a political move remains on the table in the new environment after the referendum. As Erdogan’s authoritarianism deepens and economic or foreign policy crises erupt, Gul is likely to remain relevant ahead of the critical election in 2019.

The key question, however, is whether the opposition — displeased and worried but still scattered and confused — can organize politically to mount a serious challenge. One must admit that this is no easy prospect. The 49% “no” camp includes antagonistic political movements whose reasons for rejecting the constitutional changes do not necessarily overlap, meaning that their ability to agree on and vote for a joint candidate cannot be assumed.

Moreover, Turkey’s political culture lacks any strong traditions of electoral alliances and compromise. Reconciliation between the MHP’s dissident naysayers and the Kurds, or between the conservatives and the left, seems quite difficult. Finally, the AKP remains the country’s strongest and best-organized political machine, with its popular support still at about 44% despite the recent hemorrhage.

All those developments are putting Turkish politics on a new and uncharted track.

US president Trump, who was the first Western Head Of State to congratulate Mr. Erdogan on his so-called referendum, victory, also did not mention the Turkish President's human rights abuses, including the imprisonment of journalists, politicians, civil servants and educators.

President Erdogan will be hosted by the US President in the White House when he visits the US starting May 16..

Given the unstable political situation in Turkey, President Trump might once again be betting on the wrong horse and eventually shoot himself in the foot ?

EU-Digest

Eastern Europe and Refugees: Fighting the wrong battle: Central Europe’s crisis is one of liberal democracy, not migration - Michal Simecka and Benjamin Tallis

The hostile response of central and eastern European heads of states to the prospect of accepting Syrian refugees is emblematic of a wider problem of democracy and liberalism in these countries.

When the European Commission unveiled its plan for binding refugee resettlement quotas in April 2015, few had expected the governments of ex-communist Member States - which have no Middle Eastern or African immigrant communities to speak of - to warmly embrace the scheme.

However, the intensity, hysteria and hypocrisy of the anti-migrant backlash shocked many, including some in the Visegrad countries themselves. Political cowardice and popular mistrust of supposedly liberal elites has allowed poisonous rhetoric directed at migrants to dominate, which risks political isolation and hinders common European action to address the crisis.
 
Encouragingly, counter-currents of resistance to the xenophobic rhetoric and callous political expediency are starting to emerge in Central and Eastern Europe (CEE). Meanwhile, pressure is mounting on the Visegrad governments, meeting in Prague for an emergency summit on Friday, as it becomes increasingly clear that their approach is not only out of line with Europe's moral responsibilities, but also out of line with key European states such as Germany and France.

However, these belated, weak and ineffective responses are symptomatic of deeper social and political problems in the Visegrad countries (Poland, the Czech Republic, Slovakia and Hungary). The migration crisis has exposed another crisis – of liberal democracy in post-communist societies.

It is regrettable - indeed "scandalous", as French foreign minister Laurent Fabius put it – that on one of the few issues on which the Visegrad countries have made their collective voice heard, it contradicts European values and the ethos of the EU. Given the region’s history it is particularly concerning that Central Europeans are currently part of the problem rather than part of the solution.

Note EU-Digest: Sad and deplorable to see how some of our own EU member states in Eastern Europe like Hungary and Poland are reacting to efforts being undertaken to come to a common solution to solve the avalanche of Middle Eastern refugees by a system of proportional distribution of these refugees around the EU. With an aging population and a lack of qualified workers this migration flow  actually be a blessing in disguise for the EU.

Read more: Fighting the wrong battle: Central Europe’s crisis is one of liberal democracy, not migration | openDemocracy

Turkey - Erdogan'sTurkish prosecuters launch investigation into leader of pro-Kurdish opposition

The leader of the pro-Kurdish People’s Democratic Party, Selahattin Demirtas, is under investigation by a Turkish prosecutor over allegations that he “provoked and armed” protesters during demonstrations in the country last year.

Demirtas has accused Turkey’s President Tayyip Erdogan of launching air strikes in Syria and Iraq to prevent Kurdish territorial and political gains.

Demirtas said: “Erdogan is doing this to create a false perception among the general population. His main objective is not to disarm the PKK but instead make sure the People’s Democratic Party pays the price for PKK violence. He doesn’t care about peace,” he added. “Erdogan wants to take revenge out on the People’s Democratic Party for their results in the elections.”

The investigation comes as Ankara carries out air strikes against the PKK in Iraq, a move that has brought years of peace efforts close to collapse.

Read more: ErdoganTurkish prosecuters launch investigation into leader of pro-Kurdish opposition | euronews, world news

EU-US Trade Negotiations: French senators strongly attack trade deal - What about Dutch Parliament? Asleep?

During a debate in the French Senate, all political parties harshly criticized the Transatlantic Trade and Investment Partnership (TTIP), but the French government defended the potential deal, EurActiv France reports.

The minister in charge of foreign trade, Nicole Bricq, admit with regret that France was the country where the mobilisation against what they call the 'transatlantic treaty', is the strongest.

A debate, which took place in the Senate on Thursday (9 January), showed bipartisan opposition to the agreement and the government found itself somewhat isolated on the topic after facing criticism from
speakers from all political sides.

he former French interior minister, Jean-Pierre Chevènement, reminded that the idea for a partnership was first and foremost an American idea, as the US wished to rebalance the trade surplus that the EU had with the country and bring back jobs to their continent.

“The companies’ interests are not always those of the states," warned  a politician, who considers that the currency issue should have been settled before signing a trade agreement.

“We should have put in place a transatlantic snake in the tunnel in order to establish, softly, a real parity between the euro and the dollar. We cannot talk about free trade when the parity between euro and
dollar go from one to two in ten years only.”

In his opinion, this aspect should be included in the negotiations, but the minister Bricq replied it was not on the agenda.

André Gattolin, a Green MP, also strongly opposed the partnership project, said that Europe had its own identity and should preserve it.  He also put forward the impact it would have on inequality in different European countries.

“We are promised 0.5% growth but only some zones will take advantage of it like the ports of Rotterdam and Antwerp,” the MP went on to say.

“As it is, this project is bad and we saw with the NSA scandal that the dice are loaded,” he added.

Jean Bizet from the centre-right opposition, UMP, expressed concern about the food and agriculture aspects of the deal and notably the milk file, as cheese imports increase in France and milk producing regions grow anxious at the end of milk quotas in 2015.

The sharpest remark came from a member of the government's socialist majority, Marie-Noëlle Lienemann.

“I am very hostile to this treaty,” she said. “We are forced to note that happy globalisation did not happen! … multinational companies are in a situation that we cannot regulate,” she added.

The MP was sceptical about the growth perspectives, too. She added that the promised growth points could be reached with a recovery policy supported by large-scale work projects.

Read more: French senators strongly attack EU-US trade deal | EurActiv