Document Type



Presented at the 4th Inter-University Graduate Student Conference at Cornell Law School, March 2008.


The Commission of the European Communities is currently drafting a proposal for an EU Directive to implement the first comprehensive corporate tax strategy for the Internal Market. The adoption of a common consolidated corporate tax base for EU multinational enterprises is one of today’s most highly debated issues on Brussels’ political agenda. Since the reform would affect all international companies conducting business in the Internal Market, it should also be of great interest for non-EU corporate and tax law scholars and lawyers. The paper critically evaluates the key advantages and disadvantages of the concept of an EU consolidated tax base and thus will enable the reader to form her own educated opinion on this ambitious political project. The analysis commences with a description of the status quo of corporate taxation in the European Union and a thorough assessment of its major downsides before turning to the key features and the current progress of the EU Commission’s reform proposal. Next, the paper discusses whether such a Directive could indeed effectively address the identified problems of cross-border taxation and improve the framework for business activity in the Internal Market. Considering possible disadvantages and remaining uncertainties of the proposal, the analysis focuses particularly on the issue of political feasibility and offers comparative law thoughts on a possible income distribution formula.

Date of Authorship for this Version

April 2008


European Union, Law reform