For decades, the European Commission has made attempts to resolve the problem of tax avoidance and harmful tax competition in the European Union. It has proposed various solutions, including the Common Consolidated Corporate Tax Base (CCCTB), the EU Anti-Tax Avoidance Directive (2016/1164) (ATAD), and the recently discussed Pillars One and Two approaches, along with a new Framework for Income Taxation for Business in Europe (BEFIT). This article focuses on why the problem has not been satisfactorily solved to date. It also proposes an alternative approach to address the problem.