SMEs face major uncertainties, supply constraints, labour shortages and unfair competition.
One of the main conclusions of the 8th Cohesion Report is that although cohesion and convergence among regions in the European Union has improved, there are still remaining gaps especially in less developed regions related with their territorial characteristics. EU islands, mountain areas and sparsely populated areas still face many challenges on their growth and income and disparities exist.
In these regions, there are still a lot of gaps in terms of employment and investment, social exclusion is evident and gender disparities have not diminished.
EU rules on late payments have triggered a reduction in payment delays. However, still more than 60% of businesses in the EU are not paid on time and small and medium-sized enterprises are most affected. The initiative will provide relief to SMEs by revising existing EU payment rules based on available and upcoming evidence to promote a definitive shift towards a culture of “prompt payment".
The EC proposes establishing a Head Office Tax system for micro, small and medium sized enterprises (HOT), and amending Directive 2011/16/EU. The objective of the proposal is to give small and medium-sized enterprises (SMEs) operating cross-border through permanent establishments (PE) the option to interact with only one tax administration – that of the Head Office – instead of having to comply with multiple tax systems.
At the request of the Belgian Presidency of the Council of the EU, the EESC is drawing up this opinion to suggest recommendations on how to tackle inequalities, foster upwards social convergence and strengthen social security systems and ensure its long-term affordability, in an EU economic governance framework/European Semester defined around debt sustainability, productive investments and reforms. This opinion is also focusing on the implications of such a framework for the European Semester, and the further strengthening of the social pillar herein. Finally, the opinion also looks at ways of continuing to further develop fiscal instruments that have a stabilising role at the European level, based e.g. on the experience of SURE.