EU finance ministers closed the excessive deficit procedure for France Friday, confirming its deficit has dropped below 3% of GDP. They also issued budgetary recommendations to Hungary and Romania.
As a consequence, 23 of the 24 procedures that were open against France at the height of the euro crisis have now been closed.
Following the finance ministers’ decision, France will be subject to the preventive arm of the EU’s fiscal rulebook.
At the meeting, the Council also issued recommendations to Hungary and Romania, calling on them to correct significant deviations from their medium-term budgetary objectives. It found that Romania has so far failed to take effective action.
Ministers made a significant move against tax fraud with an agreement on measures to strengthen administrative cooperation in order to improve the prevention of Value Added Tax (VAT) fraud.
“Unacceptably high amounts of VAT revenue are being lost,” said Bulgaria’s finance minister Vladislav Goranov, for the EU presidency, “and this directive will help fix the problem.”
Loopholes in the EU’s VAT system can lead to large-scale VAT fraud, says the EU Commission, causing losses of EUR 50 billion for national budgets of EU Member States each year.
The proposed regulation addresses the most widespread forms of cross-border fraud. It boosts information exchange, strengthens the Eurofisc tax network and introduces new instruments for cooperation amongst the member states.
Once in force, Member States will be able to cooperate more closely in the fight against criminal organisations, including terrorists
The Council also adopted a directive making the 15% minimum standard VAT rate a permanent feature of the VAT system, and approved an agreement aimed at boosting VAT cooperation with Norway.