"France, Germany and three other European Union countries said they would press ahead with the implementation of a 15% minimum tax on large companies as soon as next year, despite a veto by Hungary on the internationally agreed plan.
Since each of the EU's 27 member states holds a veto over most tax decisions, Hungary's move has made bloc wide legislation to implement the plan impossible.
Nearly 140 countries agreed last year to impose a 15% minimum tax on large companies, paving the way for the most significant overhaul of international tax rules in a century by placing a floor under corporate tax payments.
Months later, there has been little progress on changing national laws to implement the tax.
Speaking Friday after a meeting of EU finance ministers in Prague, French Finance Minister Bruno Le Maire said France, Germany, the Netherlands, Italy and Spain had agreed to press ahead with the tax.
"Now we want to advance and put in place as soon as 2023 the minimum corporation tax," Mr. Le Maire said. "We will not wait."
Mr. Le Maire said France and its partners are weighing two options. One would be to trigger a special EU procedure called enhanced cooperation, which allows an initiative to go ahead when it has the support of at least nine countries, while those opposed can sit the measure out.
Alternatively, the five countries and any who wished to join them would go it alone and coordinate the implementation of the tax through domestic legislation.
"We have signed off on the corporate minimum tax quite a while ago, and we can't be held back on such an important issue," said Dutch Finance Minister Sigrid Kaag.
Hungary's stance has been a source of frustration for the big European nations that are the most enthusiastic supporters of the new tax. It is also the latest example of Hungary standing in the way of EU decisions.
Hungary passed a resolution in its Parliament opposing the minimum tax. Its government argues that the uncertainty about Europe's economic outlook following sanctions on Russia makes it a bad time to raise taxes.
Previously, Poland had objected on different grounds, but reversed its opposition earlier this year.
In the U.S., the minimum tax plan has hit obstacles in Congress.
Biden administration officials had planned to use Democratic fiscal legislation to enact the U.S. piece of the deal struck last year, but that failed. Now the administration is hoping other nations will implement the tax first, eventually pulling the U.S. alongside.
That could be challenging if Republicans opposed to higher taxes win control of the Senate in November.
The U.S. has adopted a different 15% tax on some large companies as part of a law signed in August. It isn't yet certain how that tax would interact with taxes elsewhere." [1]
1. World News: Some EU Countries Move Ahead With Minimum-Tax Plan
Norman, Laurence.
Wall Street Journal, Eastern edition; New York, N.Y. [New York, N.Y]. 10 Sep 2022: A.9.
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