Ecology, Energy, EU – Baltic States, Investments, Legislation, Modern EU

In order to limit the ambient temperature increase below two degrees Celsius, for example, the member states need about €180 billion in additional yearly investment for the next couple of decades.

Public “climate finances” will continue to play a significant role, but that is not enough; some broader range of contributions is needed. Therefore, the EU member states need to increase the flow of the private capital in green and sustainable investment. However, in this approach, the private sector will slowly become a key source of climate finance, as many companies are already working on this.

Changing investment culture

In order to facilitate a systemic change, both the EU and the member states have to change the investment culture. For example, already in 2018 the Commission will present a comprehensive strategy for sustainable and green finance in the EU.

This strategy will install, for example, EU-wide green labels and classification for green assets. It will also suggest integrating sustainability into the investment chain and credit ratings. The Commission will also look into so-called “green supporting factors”. Specifically created High Level Expert Group on Sustainable Finance is examining these and other aspects of additional investment opportunities; a first exchange of opinion is due at the end of 2017.

The Commission also presented in the start of October 2017 a proposal for the biggest reform of EU VAT rules in a quarter of a century moving towards a definitive VAT regime. Around €50 billion - or €100 for each EU citizen – is estimated to be lost due to cross-border VAT fraud. The Commission’s reform would cut this fraud by 80%.

The Commission also intends to update the EU states’ ministers on the taxation of the digital economy. Following Commission’s Communication published in September 2017 these taxation issues have been discussed by the EU leaders the Tallinn Digital Summit (during Estonian Council Presidency). A widespread agreement was reached that the digital revolution requires a new approach on corporate taxation for the digitalised economy.

Commissioned also welcomed the formal EU member states ministers’ approval (10.x.2017) of new rules to ensure that businesses and citizens have access to a better system to resolve disputes related to the interpretation of treaties and to do so more swiftly and effectively. It will also cover issues related to double taxation which is a major obstacle for businesses, creating uncertainty, unnecessary costs and cash-flow problems. The new mechanism will apply for any disputes related to tax issues on income from January 2018.

The member states’ feedback and exercise on the 2017 European Semester has been also improving in terms of political ownership, increased transparency and the quality of the information flow between the Commission and the EU member states. Sectoral ministers in the member states also consider that the Country Specific Recommendations (CSRs) focus on the right policy priorities and on most urgent reforms.

However, the Commission also agreed that the real success of the European Semester can only be measured against actual implementation of the reforms; as is known, the degree of implementation of CSRs still varies across countries and policy areas.

Source: http://europa.eu/rapid/press-release_SPEECH-17-3842_en.htm?locale=en