Formulary apportionment and the future of company taxation in the European Union : company taxation and the internal market

In October 2001, the European Commission set forth a strategy for future company tax policy in the European Union that endorses “the fundamental concept of a common company taxation system in the form of a consolidated corporate tax base for the Internal Market.” The Commission makes the case that in the long run companies should be able to achieve a consolidated corporate tax base with cross-border loss relief under a single set of tax rules for their EU activities.1 Each of the four methods presented generally provides for consolidated taxation with formulary apportionment.