The European Association of Cooperative Banks (EACB) gladly takes the opportunity to comment on the OECD consultation about the Pillar 2 on how to tax MNEs.
The EACB welcomes the OECD's plans for Pillar 2, which aim to subject the profits of international companies to a minimum taxation. Given the structure of Co-operative banks, a great number of those will not be affected by the new rules. However, some Co-operative Banks, which tend to operate internationally, might fall under the scope of the minimum taxation. This may specifically be the case for the Central institutions of Cooperative banks Groups and networks.
In view of these circumstances, the EACB believes that the financial sector should be exempted by the new minimum taxation under Pillar 2.
The EACB believes that this carve-out should be granted to financial sector both for simplification and, in particular, for compliance cost reasons. The EACB asks for a carve-out for banks as it has also asked for the unified approach under pillar 1, also based on political and financial reasons and according to the differentiation criterion, under which the specific type of enterprise of banking is regulated by a complete different set of rules.