REALITY CHECK. The new EU Inc. type of company is a great initiative, but you will STILL need to apply all the local, national and regional reporting, taxes and authorisations, including taxes at all levels, employment taxes, GDPR, etc etc etc, and all other regulations that all administrations and the EU will continue to invent and enforce.
These initiatives are VERY political and sound nice, but the reality is that there are a lot of things yet to be done.
"Today, the European Commission presented its proposal for EU Inc., a new single set of corporate rules, building the cornerstone and starting point for the EU's 28th regime. EU Inc. is an optional, digital-by-default European corporate framework. It will make it easier for businesses to start, operate and grow across the EU – incentivising them to stay in Europe, and encourage those who once looked elsewhere to return."
The biggest innovation of the EU Inc. initiative is the definition and facilities for innovative startups and scale-ups.
But opening a new company was anyway the easiest thing to do in a lot of countries (with a few exceptions).
Then, the operation of the company remains pretty much the same as today. All the local, regional and national taxes, rules and regulations remain applicable.
AS AN EXAMPLE,
If you are a French citizen, with Romanian fiscal residency, with a personal property in Belgium, and own a company in Bulgaria, with customers in Poland and employees in Greece, you will pay:
* Tax on personal property (and rent) in Belgium.
* Profit tax in Bulgaria (depending on the type of business, also possibly in Poland - depending on local/national regulations and type of service. Most national fiscal authorities tax you depending on where you earned your profit, or effectively operate, not necessarily on the place of incorporation).
* Tax on income from dividends: in Romania.
* VAT in all countries where the company operates, mostly Bulgaria, but maybe also Poland (depending on the delivery location, type of product/service, and type of clients, e.g. if the client is registered for VAT purposes or not)
* Employee and employment taxes in Greece (and most probably also something in Bulgaria).
I am not joking.
EU creates regulations that kill European businesses and innovation, and then makes reports and recommendations to ease the regulations (such as the Draghi report, or all recent declarations of Mme Leyen, or of most politicians).
For instance, one of the biggest barriers for cross-national businesses are the banking and financial regulations, imposed mostly by the EU and ECB. Opening a new bank account for a new business is probably THE MOST DIFFICULT operation in most European countries.
Another barrier to startups is the GDPR. And the AI Act will be hitting us soon.
IN CONCLUSION, these initiatives are VERY political and sound nice, but the reality is that there are a lot of things yet to be done.
The press release is here.
https://ec.europa.eu/commission/presscorner/detail/en/ip_26_614
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