Good morning and welcome to Euro Express.

The long road to implementing last year’s global agreement corporate tax It’s just getting started, but France’s move to raise the minimum tax rate by at least 15 percent has met resistance in several member states. As EU finance ministers discuss the plans today, we’ll unravel the questions and why Paris will seek maximum speed on this front ahead of April’s presidential election.

Meanwhile, in Strasbourg, the European Parliament, which is voting today for a new president, paid tribute to David Sassoli last night, with several including France’s Emmanuel Macron and Italy’s Mario Draghi. EU leaders attended the meeting.European Commission President Ursula von der Leyen, who drove to Strasbourg yesterday, find out Her driver tested positive for Covid-19.

In Spain, Prime Minister Pedro Sanchez receives Germany’s new chancellor and center-left family member Olaf SchultzBut political ties aside, Madrid still has to wait for Berlin to allow changes to EU fiscal rules to exclude green investments from deficit and debt calculations.

With the French president’s strong rhetoric on trade at the start, we’re exploring what “reciprocity” means in the context of agriculture, following yesterday’s first Agriculture Committee year.

tax time

OECD last year trade Agreeing on a corporate tax framework by no means means the battle is over, writes Sam Fleming in Brussels and James Shotter in Warsaw.

The next stage is implementation into national laws, a process that will be fraught with political risk in both Europe and the United States.

As a reminder, the global agreement signed in October contains two “pillars” — one that compels large multinationals to declare profits and pay more in the countries in which they do business, and a second that requires a global minimum effective corporate tax rate of 15 percent.

Late last year, the European Commission proposed a draft directive implementing the second pillar, which would require approval by the government and the European Parliament. On the other hand, proposals to bring Pillar 1 into force would only come after the OECD’s expected multilateral convention this summer containing details of the arrangement.

The French presidency of the EU will drive this process forward. Paris is eager to make quick progress on minimum taxes as Emmanuel Macron prepares for his expected re-election bid in April.

Finance ministers will discuss how things are at the Ecofin meeting in Brussels today, and not all capitals are as they see it. Some member states – Hungary, Poland and Estonia among them – think Tie the implementation of the two pillars firmly together instead of letting one lead the other.

Their reasons vary, but one motive is to put pressure on the United States to push through both parts of the deal, not just half of it.

Given the peculiarities of its tax system, Estonia is in any case cautious about international tax agreements. Meanwhile, Hungarian Prime Minister Viktor Orban’s upcoming elections this spring have intensified his appetite for a fight with Brussels.

Both the French president and the committee oppose the idea of ??making the implementation of one part of the package legally dependent on another. “We intend to make progress on these two pillars as soon as possible,” said an EU official, who warned that blocking progress on the first pillar would jeopardize the implementation plan by 2023. “We should allow a delay in agreeing on a pillar to avoid negative spillovers.” Affect the other side’s progress. “

While some EU diplomats expressed optimism about a parallel U.S. process, appearance more and more adventurous. The minimum tax surcharge was part of the “Build Back Better” legislative package that was scuttled late last year. Pillar 1 elements face a bumpy road as the midterm elections in late 2022 loom.

Daily Chart: The Covid Pass Effect

European countries that introduced Covid passports have increased vaccination rates, improved public health and economic performance, and may have helped avoid lockdowns, according to a study by Bruegel. (more here)

Olaf and Pedro

Will Germany’s new Social Democrat-led government allow EU fiscal rules to become more lenient? That’s the hope Sánchez expressed when Scholz called yesterday.But the German chancellor made clear his respect for the Stability and Growth Pact, which southern Europe is far less fond of, writing Daniel Dombey in Madrid.

Meanwhile, Germany’s new finance minister, Christian Lindner, from the frugal Liberal Democrats, told other euro zone ministers in Brussels that a return to euro zone fiscal rules would help keep inflation in check. He said Germany was open to suggestions on how to improve the framework, but the “real debate” on reforming the rules would only start in June.

In Madrid, Scholz was evasive, praising the stabilization deal as a “framework” for European cooperation and avoiding promises to ease the EU’s deficit and debt rules.With a debt-to-GDP ratio of 120%, Spain is particularly keen to revise the stability deal already signed by France and Italy Require Amendments to support debt raised for “essential investments”.

Sánchez, standing next to Scholz, said the rules were “too complex and difficult to meet in the context of the pandemic” and argued they needed to be reformed to facilitate investment in the energy transition and digitalisation.

Sanchez declared that the two leaders were “in step” and shared an ambition to strengthen the EU, “move a social Europe forward and defend our social democratic values ??and principles”.Relations between the German Social Democrats and the Spanish Socialists Go back decades – especially Spain’s transition to democracy, when German parties extended a helping hand to Spanish parties.

The meeting appeared very amiable, with Scholz going hand in hand with Europe, while Sanchez denounced any attempt to divide the EU into hostile camps.Neither expressed sympathy for Novak Djokovic, the unvaccinated tennis player who just be deported from Australia. “The rules have to be followed,” Sanchez said, slightly different from his research on stabilization agreements.

farmer reciprocity

Freedom, equality, fraternity, reciprocity! The French presidency of the European Union likes a slogan.French Agriculture Minister Julien Denormandie was eager to bring his message home yesterday after chairing this year’s first Council of Agriculture Ministers, writing Andy’s border in Brussels.

De Normandy said it at least a dozen times in his post-meeting press conference as he made clear Paris’ priorities for the next six months.

council definition The reciprocity is to ensure that “agri-food imports into Europe comply with EU environmental and health standards, especially with regard to the sustainable use of botanical medicinal products”.

Farmers complain about the cost of complying with EU agricultural standards, while the EU accepts imports from countries with less stringent rules. The subject is not new, but De Normandy said the debate had recently turned in France’s favor. (Britain is a big opponent).

“Reciprocity is one camp — you pit yourself against others who defend a more liberal approach. That’s not the case anymore,” he told reporters after the meeting. He said no minister was against the idea.

Paris wants to use a “mirror clause” that would allow products made to a lower standard to be banned, arguing that they are WTO-compliant.

However, some member states and committee officials disagree and worry about a series of legal cases. Ministers were also briefed on the global growth rate of 27% a year. food prices During the year ending November 2021. Banning cheap imports could be a tough selling point for cash-strapped voters.

what to watch today

1. EU finance ministers meet in Brussels to discuss draft minimum corporate tax law

2. European Parliament votes for new president

notable, citable

As the German government, we will do everything we can to get back to the negotiating table

• Back to Normandy: German Foreign Minister Annalena Berbock promote Resumption of France-Germany-Russia-Ukraine (“Normandy”) dialogue mode to de-escalate tensions in Ukraine.

• Zemmour was fined: French presidential candidate Eric Zemour is convicted Paris court ordered a €10,000 fine for “incitement to racial hatred” for hate speech. The court ordered that if he didn’t pay, he faced 100 days in prison.

• Swiss Covid-gate: Credit Suisse Chairman Antonio Horta-Osorio expelled On Sunday, following an internal investigation into his serial Covid-19 quarantine breaches and “excessive” use of the bank’s business jets.

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