Brussels – Slovak MEP Ľudovít Ódor (RE/PS) has been appointed as the rapporteur of the European Parliament (EP) for the proposed 28th EU legal framework addressing tax matters, as announced at the end of last week. In a Thursday interview with TASR, he emphasized that this framework aims to establish a cohesive set of rules for innovative and start-up companies, facilitating their operations within the EU single market.
Ódor stated that the purpose of this regime, in addition to the existing regulations of the 27 member states, is straightforward: to guarantee fair and predictable taxation without hindering businesses when operating across member states; to create a clear linkage to current national legal systems; and to minimize administrative burdens.
As rapporteur, Ódor will concentrate on tax matters, examining the implications for tax obligations, income taxation methods, and measures to prevent double taxation, while also ensuring appropriate reporting to alleviate unnecessary pressures on businesses.
The EU lacks a functioning single market for start-ups and innovative firms
Ódor described the current situation, noting that many sectors in the EU do not have a fully operational single market, particularly affecting innovative companies. He explained, “When an entrepreneur in Slovakia has a promising idea and wants to grow it, expansion into other EU countries often proves challenging. Start-ups lack the resources to navigate diverse legal frameworks and tax regimes, leading to significant costs simply to scale their products.”
He highlighted that the complexity often drives new businesses to consider expanding to the United States instead of remaining in Europe. Ódor proposed two ways to address this issue: gradually harmonizing regulations for innovative companies, a lengthy undertaking, or implementing a “shortcut” through the establishment of the 28th regime.
“This involves creating a unified regime that allows innovative companies to operate across the EU seamlessly. It enables access to a market of over 400 million people without the need to navigate individual state regulations. This creates a significant competitive advantage compared to larger markets like those in China and the United States,” Ódor explained.
The MEP also referred to Mario Draghi’s report on EU competitiveness, which underscores the necessity for the 28th regime. Draghi had called for the topic to be addressed within the EP Subcommittee on Tax Issues (FISC), indicating that the European Parliament will need to formulate a stance on it. A proposal for the 28th regime is expected from the European Commission and the European Parliament next year. Should euro-institutions reach an agreement through trilogues, this regime could be implemented to better serve innovative European businesses. (November 6)
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