Moscovici banks on qualified majority voting to secure his legacy

Europe Letter: Commissioner at loggerheads with Dublin over taxation of digital giants

European commissioner  Pierre Moscovici is asking the member states to allow voting on tax issues to move from unanimity  to QMV. Photograph: Costas Baltas/Reuters

European commissioner Pierre Moscovici is asking the member states to allow voting on tax issues to move from unanimity to QMV. Photograph: Costas Baltas/Reuters

 

With the European elections looming and the commission’s term running out, it’s time for a commissioner to be thinking in legacy terms. Sure, there are some 200-plus legislative acts still in the pipeline, most of them unlikely to make the statute books, but they are not the ones by which the commission will be remembered.

Better to go out with a bit of blue-sky, visionary thinking. And so economic affairs commissioner Pierre Moscovici has launched a new project that has little prospect of getting anywhere but will remind Brussels and his native France that he was here.

Moscovici is asking the member states to allow voting on tax issues to move from unanimity or consensus to qualified majority voting (QMV).

The transition from unanimity voting to QMV across the EU institutions’ myriad competences is far from a simple technical issue. It is an important symbolic measure of the union’s historic integration process. It marks the transition between sovereignty shared between member states and sovereignty pooled, between the EU as an intergovernmental alliance of states and a union.

Over time the number of areas reserved to unanimity has declined, with foreign and security policy and taxation remaining the main holdouts. Both, it is argued, are crucial aspects of national sovereignty, and the national vetoes are jealously guarded.

Now the commission, always an advocate for the “community method”, has proposed a gradual phasing-in of QMV in both spheres. Moscovici argues that it is all about efficiency: “The unanimity rule in taxation increasingly appears as politically anachronistic, legally problematic, and economically counter-productive.”

Controversial

He acknowledges that the move will be controversial but says, “let’s begin the debate today.”

Moscovici and French foreign minister Bruno le Maire have been at loggerheads with Dublin for months over their proposals for the taxation of the digital giants and the vetoes that will block the proposal.

And the commissioner makes no bones about the row being part of the rationale for his new proposals. His case is made by the commission services on the basis of the huge cash savings that could be made if QMV were implemented – but, as sceptical national officials point out, most of the enormous savings relate to the enactment of specific measures currently blocked under unanimity voting, and not to QMV itself.

Even the phasing – he is not proposing that digital tax be affected until 2025 – is unlikely to sweeten the pill sufficiently to make the proposals acceptable. Unanimity also applies to such changes, and many more states than Ireland are deeply sensitive about their national prerogative over tax policy and will oppose the measure.

There is an irrefutable logic to Moscovici’s and Juncker’s case for pooling sovereignty and QMV

Critics also argue that the Moscovici plan takes no account of the reality that the working method of council (ministerial) formations is consensus, even where QMV may be allowed. That does not prevent decisions from being taken, although it may take longer, but, they say, by and large the decisions taken this way are more acceptable and more likely to be implemented successfully.

Asylum seekers

That is so in the controversial area of reform of the Dublin regulations on how to treat asylum seekers. Although new rules requiring mandatory sharing of the burden could be passed under the QMV regime which applies to migration issues, most states are unwilling to see such changes forced on the likes of Poland and Hungary, which would almost certainly refuse to implement them.

The result would not be the resettlement of asylum seekers but a constitutional crisis in the union. Better to continue to work for consensus, however long it takes.

And yet there is an irrefutable logic to Moscovici’s and Juncker’s case for pooling sovereignty and QMV. Some decisions do take forever, or are held hostage by individual member states against concerns on other issues.

Although member states are treaty-bound not to impede decision-making (famously enacted after Italy held up all business in a bid to get an EU agency located in Parma), the veto or the threat of it is still a factor in decision-making. And there is little prospect, pace Moscovici, of it being further relinquished.

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