EU finance politician Paul Tang calls on Europeans to commit to Biden's tax plan

MIRROR: Mr. Tang, the US government is proposing a global minimum corporate tax of 21 percent. How should Europe react?

Paul Tang: Joe Biden has taken on a dual leadership role. First, he has launched a large program of public investment that creates economic progress. And secondly, it shows how to finance something like that. Biden rightly demands that companies bear a fair share of the costs, after all, they benefit from it. Europeans should take this as an example.

SPIEGEL: The German Finance Minister Olaf Scholz welcomed Biden's advance enthusiastically. Isn't that enough for you?

Pliers: What we have heard from the European governments so far have been many fine words, but unfortunately no commitment to the tax rate of 21 percent that Biden has brought into play. Corporate taxes are significantly higher in many European countries today, and in the past they were much higher. So I see no reason why Germany or France Biden's proposal should not specifically endorse. It is time to send a strong signal here.

SPIEGEL: Europe's finance ministers show consideration for their colleagues in Eastern Europe. Tax rates are often very low there in order to attract investors into the country. Is that wrong?

Pliers: No. It makes sense to let the tax rates fluctuate to a certain extent with economic strength. Like in Switzerland, where the richest cantons also have the highest rates. In Europe, on the other hand, corporations are often taxed very low, even in very wealthy countries, as in Ireland or Luxembourg. That has led to a race for the lowest tax rates that has been going on for two decades. This needs to end now.

SPIEGEL: Does that also apply to them Netherlands, Your home country, which is also a tax haven in Europe?

Pliers: That's right, and that's not something to be proud of. There is a real tax avoidance industry in the Netherlands that makes its profits at the expense of the general public. It would be an advantage if the lawyers or management consultants employed there took on more productive tasks in the economy.

SPIEGEL: Die United States Not only do digital companies want to tax more heavily, but all corporations that generate above-average profits. Wouldn't that also affect German or Dutch companies?

Pliers: Probably, and that would only be fair. If the Europeans rightly raise taxes for Amazon and Google demand, they have to accept that the US is asking the same for companies in the auto or chemical industries. All the more so when these corporations generate a significant part of their profits on the American market. The rules by which corporate profits are taxed are over a hundred years old. They are out of date, and there is a great chance that the US will want to fundamentally modernize this system.

SPIEGEL: You will debate this on Tuesday with the tax and finance politicians of the Bundestag. What do you expect from your German colleagues?

Pliers: I remember when Angela Merkel spoke of a European leadership role during Donald Trump's term in office. Now his successor, whom many recently mocked as Sleepy Joe, is leading the way in tax policy. It is a European concern that corporations should provide a fair share of the financing of the community. If the US now makes this their cause, the Europeans should also take a clear position.