Oxfam on Tuesday accused the European Union of delaying discussions on the world’s lowest corporate tax rate because of its fight with Hungarian Prime Minister Viktor Orban’s government over military aid to Ukraine and EU funding to Hungary. .
“Despite the cost of living crisis, the EU’s national interests are winning.”
The move came after the Orban government in June blocked an EU directive supporting a 15% international tax rate negotiated by members of the Organization for Economic Co-operation and Development (OECD). is too low. Hungary has the lowest corporate tax rate in the block at 9%.
“Once again, EU countries failed to agree on an already low-ambition plan to implement an international minimum tax agreement,” Chiara Putaturo, an EU tax expert at Oxfam, said in a statement on Tuesday. “Despite the cost of living crisis, the EU’s national interests are winning.”
“Some EU tax havens have downgraded their tax treaty ambitions at the international level, with Hungary delaying its implementation at EU level for months,” Putatullo added. It’s a loss for ordinary people suffering from the crisis and a win for ultra-profitable companies.”
EU Ministers are now reportedly It hopes to reach an agreement on EU funding for Hungary and Ukraine as well as on taxation later this month.
At the EU economy and finance ministers’ meeting in Brussels on Tuesday, Hungary’s Mihai Varga said he was “not in favor” of lending 18 billion euros to Ukraine, which the Russian army invaded in February.
In addition to postponing global tax discussions, “the ministers have decided to drop from Tuesday’s agenda the determination of about €7.5 billion in EU funds allocated to Hungary,” he said. Reuters report.
As the news outlet detailed:
Ministers are set to vote last week on a recommendation by the bloc’s executive European Commission to freeze 65% of the cohesion fund allocated to Hungary from the EU budget until the end of 2027, citing corruption risks. I was.
Ministers also delayed a decision on Budapest’s planned spending of another €5.8 billion envisioned for Hungary from the bloc’s economic stimulus fund set up to help the economy recover from the Covid pandemic.
Together, these funds will represent nearly 9% of Hungary’s estimated 2022 GDP.
Leaders of the Green Party/European Freedom Alliance (EFA), a political group in the European Parliament, on Tuesday took aim at the Hungarian leader, denouncing the far-right president as a dictator.
Emphasizing Ukraine’s needs, Philippe Lamberts of Brussels, co-chair of the Greens and the EFA, declared that “EU leaders must confront Orbán’s bullying and intimidation” and that the tax deal should be “urgently approved”. is needed,” he said.
German co-chair Terry Reintke agreed, accusing Orban of “important” minimum tax rates for multinationals and “trying to blackmail the EU into releasing potentially frozen funds”. did.
Orban has refuted a series of extortion allegations. Tweetcalled reports about Hungary’s veto of aid to Ukraine “fake news” and said his country was willing to provide bilateral aid. He added that he aims to convince block members that debt is not the solution.
The OECD proposal has stalled again in Europe, but some global campaigners are calling for another debate on international corporate tax.
As common dream Despite criticism from wealthy OECD countries, United Nations member states unanimously approved an Africa-led General Assembly resolution, according to a report last month, calling for a resolution at the United Nations headquarters in New York City on the “comprehensiveness and effectiveness of international tax cooperation.” about how to strengthen the
Dereje Alemayev, executive coordinator of the Global Alliance for Tax Justice, said at the time, “This is a historic victory for tax justice and the broader economic justice movement, and the flow of illicit funds. It’s a big step forward in combating tax abuse and tax abuse.”