The European Parliament has approved a resolution on negotiations for a new partnership with the United Kingdom that calls for a free trade agreement with equalized tax and state aid rules, among other things.
On February 11 the EP approved 543 to 39 the text of the motion for the resolution, which calls for the United Kingdom to revise its rules on issues like “competition, labour standards, and environmental protection” to clear the way for the trade agreement, according to a February 12 news release.
“Given the size of the U.K.’s economy and its proximity, future competition with the EU must be kept open and fair through a ‘level playing field,’ which means guarantees for equal rules on, among other things, social, environmental, tax, state aid, consumer protection, and climate matters. To maintain quota-free, tariff-free trade relations, the British government should pledge to update its rules . . . to ensure ‘dynamic alignment’ of EU-U.K. laws,” the release says.
Although a new EU-U.K. partnership is set to take effect after the Brexit transition ends December 31, the resolution adds a June deadline for an agreement regarding fisheries. Otherwise, tariffs and quotas will ensue, as well as safeguard clauses aimed at protecting the EU single market, the release warns.
Even with the EP’s approval, the European Council must sign on. The council is expected to give its approval by February 25, the release says.
European Commission President Ursula von der Leyen said in a February 11 release that negotiations between the EU and United Kingdom will be highly ambitious, and she reiterated the need for fairness — a plea she made previously regarding the EU carbon border tax. Von der Leyen said the task force assigned to lead withdrawal negotiations with the United Kingdom is ready to start.
In a separate February 12 release, EP member Sven Giegold said the United Kingdom should not expect special treatment. “The British government’s attempt to give its London financial centre permanent and comprehensive access to the European financial system for decades is audacious,” Giegold said in the release. “The EU will not let the decision as to which British financial market rules are compatible with European rules be taken out of its hands. Equivalence is not a permanent subscription, but a revocable privilege. . . . If the United Kingdom deviates from the European rules, it must expect to lose access to the European financial market.”
Giegold said that position is the EP’s way of “putting its finger in the wound of British tax havens.” The United Kingdom’s overseas territories are not in line with EU rules, and tax havens will not be tolerated, he added.
The EP voted overwhelmingly to ratify the Brexit withdrawal agreement January 29, clearing the way for the United Kingdom to leave the EU January 31. A February 4 report by A&M Taxand and Capital Economics says some U.K. tax measures, such as cutting the corporate tax rate and introducing a regional corporate tax system, could give the United Kingdom a boost after Brexit.
by Annagabriella COLON
Cet article est extrait de notre service d'actualité Taxnotes.