Economic and Financial Affairs Council, 06/11/2018, 6 November 2018

Main results

Digital taxation

"We need to adapt our rules to the digital transformation of the economy and digital companies have to pay their fair share of taxes. The Presidency wants to achieve concrete results by the end of this year. Time is short but I'm convinced that with the appropriate political will, we can get there." Hartwig Löger, Austrian minister of finance and chair of the Ecofin Council

Ministers held a policy debate on the proposal to establish a digital services tax. The discussion focused on two key issues in the Commission proposal: the scope of taxable services and the question of the expiry of the directive - the so-called "sunset clause".

On the sunset clause, all member states agree that the directive should expire once there is a comprehensive solution to taxing digital economy at OECD level.

While the proposal has been thoroughly discussed at technical level and progress has been achieved on a number of issues such as definitions, tax collection, and administrative cooperation, there are still differences between member states on several issues, including the precise scope of services which would be subject to the future tax.

The Presidency concluded that there will be further work at technical level in order to be able to reach an agreement at the Council meeting on 4 December.

Climate finance

The Council adopted conclusions on the financing aspects of climate change ahead of the COP24 conference on climate change which will be held in Katowice (Poland) from 3 to 14 December.

The draft conclusions call for swift and ambitious progress in ensuring that finance flows reflect the objectives set by the Paris agreement. They underline the importance of carbon pricing in shifting financial flows towards green and sustainable investments.

The EU and its member states are committed to increasing their financial contribution to help developing countries implement the Paris agreement. They continue to be the largest provider of public climate finance, with an overall contribution of €20.4 billion in 2017.

• Council conclusions on climate finance ahead of COP 24 conference, 06/11/2018

In addition, the Council:

• discussed the implementation of the EU budget in 2017 on the basis of Court of Auditors' report
• adopted a directive allowing for the alignment of VAT rules for electronic and physical publications. From now on, member states will also be able to apply reduced, super-reduced or zero VAT rates to electronic publications
• removed Namibia from the EU list of non-cooperative tax jurisdictions
• adopted conclusions on EU statistics.

• Electronic publications: Council adopts reform allowing reduced VAT rates (press release, 06/11/2018)
• Council Conclusions on EU Statistics, 06/11/2018