Commission requires Belgium and France to put an end to tax exemptions for ports

Background and further information:

The Commission argues that profits by port operators must be taxed under national corporate tax laws to avoid distortions of competition.

In Belgium, a number of sea and inland waterway ports have been exempt under Belgian law from the general corporate income tax regime. These ports have been subject to a different tax regime, with a different taxable base and tax rates, resulting in an overall lower level of taxation for Belgian ports as compared to other companies in Belgium. Most French ports are fully exempt from corporate income tax under French law.

Belgium and France were given until the end of 2017 to take the steps to remove the tax exemption in order to ensure that, from 1 January 2018, all ports were subject to the same corporate taxation rules as other companies.

In July 2014, the Commission informed Belgium and France about its concerns regarding their regimes for the taxation of ports. In January 2016, the Commission asked Belgium and France to adapt their legislation to ensure public or private ports pay corporate tax on their economic activities in the same way as other companies. Since Belgium and France did not accept these measures, the Commission opened the formal investigation procedure in July 2016.

In January 2016, the Commission took a decision that the corporate tax exemption granted to Dutch seaports to be state aid, and required the Netherlands to subject their ports to corporate tax as from 1 January 2017. The Commission also ensured that certain German seaports have put in place a transparent financing structure separating public remit activities from economic activities in order to prevent cross-subsidization from one to the other.

The European Commission decided on 27 July 2017 to require Belgium and France to abolish the corporate tax exemptions granted to their ports, so as to align their tax regime with EU state aid rules.

• Primary Source

Reuters, 27.07.17: EU tells Belgium, France to end tax exemptions for ports http://uk.reuters.com/article/uk-eu-subsidies-ports-idUKKBN1AC1EC

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