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EUROPEAN UNION

France, Germany, Spain and Italy to sidestep Hungary on global tax plan

Germany, France, Spain, Italy and the Netherlands said Friday they would implement an international minimum tax on big corporations, sidestepping Hungary's opposition to an EU-wide plan.

French Minister of the Economy and Finance Bruno Le Maire (R) and German Finance Minister Christian Lindner
French Minister of the Economy and Finance Bruno Le Maire (R) and German Finance Minister Christian Lindner speak with journalists as they arrive for an informal meeting of EU Economy and Financial Affairs Ministers and Central Bank Governors on September 9, 2022 in Prague, Czech Republic. (Photo by Michal Cizek / AFP)

The decision by the top European economies effectively ends months of effort to implement the tax jointly across all 27 member states.

The 15-percent minimum tax was one of two pillars of a major international agreement decided at the OECD and signed by more than 130 countries, including Hungary and the United States.

“Should unanimity not be reached in the next weeks, our governments are fully determined to follow through on our commitment,” the countries said in a joint statement.

“We stand ready to implement the global minimum effective taxation in 2023 and by any possible legal means,” the countries added.

French Finance Minister Bruno Le Maire, who initiated the joint text, said that “tax justice must be a priority for the European Union”.

“We will put in place minimum taxation from 2023, either through the European route or through the national route,” said Le Maire.

Christian Lindner, his German counterpart, said Germany will “if necessary” adopt the tax “independently of an agreement at the European level”.

The EU’s original ambition was that the 27-member bloc would be the first jurisdiction to implement the OECD-brokered agreement. The bloc-wide plan needed the vote of all EU countries in order to pass.

The resistance by Hungary came as the relationship with its EU partners remained fraught, with Budapest along with Warsaw seen as steering away from the bloc’s democratic values.

The Hungarian veto of the minimum tax is seen by many in Brussels as a means of pressure to obtain the release of seven billion euros ($7.3 billion) in grants planned under the European pandemic recovery plan.

Poland’s acceptance of the minimum tax came after Brussels accepted Warsaw’s recovery plan, which should see it receive 36 billion euros in grants and loans over the next several years.

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POLITICS

Italy’s government to continue sending weapons to Ukraine in 2023

Italy's new government issued a decree on Thursday to continue sending weapons to Ukraine through 2023, continuing the previous administration's policy of support to Kyiv.

Italy's government to continue sending weapons to Ukraine in 2023

The decree extends to December 31, 2023 an existing authorisation for “the transfer of military means, materials and equipment to the government authorities of Ukraine,” according to a government statement.

Since taking office in October, Prime Minister Giorgia Meloni has repeatedly voiced her support for Kyiv while underlying the importance of the Atlantic alliance.

In her first speech to parliament, the leader of the Brothers of Italy party pledged to “continue to be a reliable partner of NATO in supporting Ukraine.”

Her predecessor Mario Draghi was a staunch supporter of Kyiv, but the issue of sending arms to Ukraine split the biggest party in parliament during his coalition government, the Five Star Movement.

That friction led to the early elections that brought Meloni to power.

Parliament now has 60 days to vote the decree into law.

READ ALSO: Outcry in Italy after Berlusconi defends Putin’s invasion of Ukraine

Despite Meloni’s efforts to reassure her Western allies of Italy’s support for the EU’s and NATO’s Ukraine strategy, including sanctions on Russia, the close ties to Russia of her two coalition partners have come under scrutiny.

Both Matteo Salvini of the League party and former premier Silvio Berlusconi, who leads Forza Italia, have long enjoyed warm relations with Russia.

In October, an audio tape of Berlusconi was leaked to the media in which the former premier described how he had received a birthday present of vodka from Russian President Vladimir Putin.

In the tape, he also expressed concerns about sending weapons and cash to Kyiv and appeared to blame the war on Ukraine’s president, Volodymyr Zelensky.

Berlusconi later issued a statement saying his personal position on Ukraine “does not deviate” from that of Italy and the EU.

Since the beginning of the war in Ukraine, Salvini, too, has come under fire for his relations with Moscow, including a report that he dined with Russia’s ambassador to Rome just days after that country’s invasion of Ukraine.

Salvini, who has criticised EU sanctions as ineffective, has long admired Putin, even wearing T-shirts emblazoned with the Russian leader’s face.

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