This Tuesday, the European Commission will propose simplified taxation for small and medium-sized enterprises (SMEs), which will allow them to save 3.4 billion euros per year, while also wanting to put an end to payment delays, imposing a deadline of up to 30 days.
In a context of uncertainty due to contained economic growth, the consequences of the war in Ukraine and a restrictive monetary policy that limits access to financing, the community executive presents a package of measures to “support the resilience of SMEs, helping them consolidate its recovery and maximize its potential”, in the face of the “persistence of adversity” in the European Union (EU).
Given that these smaller companies make up a total of 24 million companies, which represent 99% of the EU’s business fabric and are responsible for two thirds of private sector jobs, Brussels wants a “great simplification in the area of direct taxation to SMEs that have created a taxable presence in another Member State through a permanent establishment”, according to the draft proposal that will be presented today and to which the Lusa agency had access.
“The planned rules will particularly benefit companies in the initial phase of international expansion. The impact assessment accompanying the proposal estimates that it could reduce tax compliance costs for SMEs by 32%, leading to overall savings of up to 3.4 billion euros per year”, indicates the institution.
The new rules are particularly aimed at cross-border companies that currently face the complexity and high compliance costs of having to comply with different corporate tax systems when operating in more than one Member State.
It is expected that these SMEs will be able to calculate the tax base for their presence in other Member States in accordance with the rules of the country where they are based and which they know best and that they will also have a simplified VAT from 2025 onwards.
Another problem that these small businesses face is late payment, which is why the European Commission wants to “replace the current directive on late payment with a regulation with maximum binding payment terms of 30 days for all commercial transactions”, according to the proposal to which Lusa had access.
The idea is to automate “the payment of compensatory fees and interests in the event of late payment”, also making it easier for “companies to claim their rights, reducing burdens and facilitating access to effective remedies through mediation”, Explain. community executive.
In these cases of late payment, SMEs have to cover the liquidity deficit through short-term loans, increasing their financing costs, with expenses that amount to 158 million euros for each day of delay, according to the institution.
The new rules aim to reduce payment delays by 35%, as well as the time lost in these situations and reduce dependence on external financing.
Under the current long-term EU budget and Recovery Fund, the European Commission’s accounts show more than €200 billion made available to SMEs.
Still, “uncertainties” persist at the economic level for these SMEs, which is why today’s package contains 17 measures to support these companies, which also include support for digitalization, incentives for investment and trade with Ukraine and responses to powers in the EU.
Source: TSF
