Remarks by Vice-President Valdis Dombrovskis at the ECOFIN press conference

Thank you Hartwig.

First of all, I would like to thank the Austrian Presidency for its commitment to reach a deal on the digital services tax.

The Commission fully supports the work of the Austrian Presidency and the objective to reach the agreement hopefully in December ECOFIN.

Reaching deal as soon as possible is important for two reasons.

First, our taxation system needs to be updated to reflect economic realities of the 21^st century. Our economies are increasingly digital and this trend is here to stay.

Second, there is a risk of fragmentation in the Single Market along the lines of digital tax. Some member states have already introduced digital tax. Others are working towards this. Still others are not planning anything at this stage as they wait for European or international solution. This creates a problem of level playing field and tax fairness, as several member states outlined today.

Of course, an ambitious global deal remains our preference. This is why we are actively participating in the ongoing work in the OECD.

But - let's be realistic. A global agreement will take time.

So, it is more realistic forging a deal at the EU level, and this would also provide momentum globally.

Today we also discussed the on-going legislative files as regards financial services.

In particular, I would like to thank the Austrian Presidency for their strong support to the Capital Markets Union project. The EU needs well developed and integrated capital markets to strengthen and support the Economic and Monetary Union and also the international role of the Euro. A fully-fledged Capital Markets Union enhances private risk sharing and helps mitigate economic shocks in the euro area and beyond.

When it comes to CMU proposals, there has been progress in the negotiations, but more needs to be done.

Last week the Austrian Presidency reached an important agreement in the Council to require banks to hold enough capital for newly originated loans if they turn non-performing. This is an important step for preventing the build-up of non-performing loans on bank balance sheets in the future.

We also invite the European Parliament to define their position, so that trialogues can start.

And it is of course also important that the co-legislators make progress on other parts of the Non-Performing Loan package.

For the coming weeks an essential objective for co- legislators is to reach agreement in trilogue on the Banking Package, where we are working together with the Austrian Presidency on this and which will also pave the way to further progress on risk sharing agenda.

On climate finance, we welcome the firm commitment of the EU countries to timely implement the Paris Agreement.

Reaching the Paris goals will require a massive financial investment, spread over many years. That kind of investment requires a constant attention from policy makers. We have seen deadly fires this summer, storms and floods that serve as evidence that we are running out of time.

So we need to walk the walk. I therefore call on the co-legislators to move forward with the three legislative proposals on sustainable finance as soon as possible and in any case before the European Parliament elections.

Thank you.

SPEECH/18/6315