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First of all, I would like to thank Minister Reirs and the Latvian Presidency for its commitment, professionalism and success in steering the Council over the past six months.
In today's Ecofin meeting, Ministers endorsed the agreement on the Regulation on the European Fund for Strategic investment, which is at the heart of the Juncker Investment Plan.
The agreement will now go the European Parliament for vote in its plenary session next week. Successful adoption will ensure that the Fund can be up and running by September as planned.
Considering the Juncker Plan was only launched seven months ago, and the proposal on the Fund only five months ago, it is remarkable that the Fund can be up and running and start financing projects as early as this summer. We promised to deliver fast – and we have.
I would like to pay credit to the Latvian Presidency, my colleague Vice-President Jyrki Katainen and the European Parliament and their respective staff for all their work on this important package.
Regarding the European Semester process, I am pleased that Ministers approved the Country Specific Recommendations, proposed by the Commission on 13 May. The recommendations this year are fewer and more focussed, concentrating on the important reforms that can be implemented by Member States over the coming 12-18 months. They will now become part of the discussions by EU leaders at the European Council next week.
The Ecofin Council also discussed the Action Plan adopted by the Commission on Wednesday to improve Corporate Taxation in Europe, making it fairer, more efficient and more growth-friendly. The Action Plan sets out a series of initiatives to tackle tax avoidance, secure sustainable revenues and strengthen the Single Market for businesses.
In the Council meeting today, we were encouraged by the progress made on our March proposals that tax authorities exchange information on tax rulings automatically. On that basis, we hope that the incoming Presidency can finalise the file as soon as possible. In fact, it seems to be realistic to finalise the file on the automatic exchange of information on tax rulings within this year.
As a second step, the Commission's Action Plan proposed a set of measures that are ambitious but realistic. As tax files touch upon difficult issues, our suggestion is to go step-by-step.
This was also the approach the Presidency followed on the Interests and Royalties Directive. The Commission supported this. Making short-term progress to tackle abuse must go hand-in-hand with keeping on the table further measures to ensure profits are taxed effectively where they are made.
But we have to take note that there was no consensus in the Council on this approach. I would like to thank you, Minister Reirs, for your hard work to push this forward; you have laid the groundwork on which the incoming Presidency can build.
Today, Ecofin, following the European Commission's recommendations, decided to abrogate Malta and Poland from the Excessive Deficit Procedure.
The case of Malta was relatively straightforward. Malta has ensured a substantially lower deficit than targeted under the Excessive Deficit Procedure and is found to be compliant on both the debt and deficit rule.
As regards Poland, the country's deficit last year was 3.2% of GDP but, following the impact of the systemic pension reform, estimated at 0.4% of GDP, it was also deemed to be below the excessive deficit threshold. However, in the case of Poland, it must be noted that it sticks to the letter of the Stability and Growth Pact, but to a lesser extent to the spirit of the Stability and Growth Pact. This abrogation is based on a systemic pension reform, which Poland has meanwhile reversed. It is therefore not entirely in the spirit of the Stability and Growth Pact but, following the formal procedure, we nevertheless made this recommendation, which was accepted by the Ecofin Council.
We also discussed the upcoming EU Summit, including a potential discussion on the Five Presidents' Report on the deepening of the Economic and Monetary Union. Publication of this report is expected on Monday. It lays the groundwork for both the short-term, for measures that can be taken immediately to strengthen the Economic and Monetary Union, to strengthen its governance, and for the long-term vision on how to ensure the institutional architecture of the Economic and Monetary Union to ensure it is effective and fully functional.
Today, Ministers also agreed its negotiating stance on structural measures to improve the resilience of EU credit institutions and adopted conclusions on the Capital Market Union. I will now pass the floor to Commissioner Hill, who will give more details on these points.
