European Taxation of Cooperatives: An Examination of the Possibilities Offered by the New Concept of Limited Profitability

Cooperatives are today a very important economic sector in the EU, especially in their small and medium-sized version, in whose business fabricthey are heavilyinvolved and account fora significant proportion of employment in Europe. However, European cooperative law expressly excludes taxation from its statute, despite the fact that tax policy is a basic pillar of European integration.On the other hand, the national laws of many Member States have established specific tax regimes for co-operatives in order tocompensate for the inferior position in which they find themselves compared to capital companies. For years, thecooperative sector hasalso been calling for decisive intervention by the EU in support of these tax regimes,which have been continually challenged under State aid rules, because, in the dichotomous conception of forms of enterprise that prevails in EU law, cooperatives are excluded from the group of non-profit companies and are included among the rest of the capitalist companies.This work will analyze the state of the art of the contribution of European law to the construction of social cooperativism, emphasizing the taxationof cooperative societies and the role thatthe concept of "limited profitability”" canplay in this contribution.