Global Corporate Tax: France says EU can bypass Hungarian veto

Press quote (Euronews)
30 June 2022

According to Zach Meyers, a senior research fellow at the Centre for European Reform (CER), "if the French presidency gives up on an EU-wide directive to implement the minimum global corporate tax because of Hungary’s veto, then any alternative will be far less legally robust."

"The European Court of Justice (ECJ) has already ruled that EU member states cannot stop corporates from taking advantage of lower tax rates available in other member states: when the UK was a member of the EU, it proposed to do this, and the regime was struck down."

"The global minimum corporate tax is structured in a similar way. If only some EU member-states signed on, those EU member states would be allowed to impose a 'top-up' tax on a corporate, if that corporate paid below the minimum corporate tax in another EU member-state," he explained to Euronews.

Meyers highlighted that although the ECJ could try to distinguish Pillar II from the earlier UK case, "based on existing case law, the ECJ could well strike down the French plan."