Tuesday

17th Jul 2018

EU may impose full tax transparency on US firms

  • Luxembourg was at the centre of a major corporate evasion tax scheme known as LuxLeaks (Photo: Jimmy Reu)

The European Commission is working on forcing big companies to publicly disclose their taxes and earnings in a move to curb tax avoidance.

While the move is likely to be welcomed by some, the EU executive still refuses to budge on allowing MEPs full access to tax sins committed by member states in the past.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... our join as a group

A commission spokesperson told reporters in Brussels on Monday (8 February) it was studying the idea to make US multinationals like Amazon and Google reveal their earnings and how much they are taxed to the wider public.

"The aim to find out whether requiring companies to disclose information about the taxes they pay could help tackle tax evasion and aggressive tax practices in the EU," reporters were told.

The commission will finalise its "impact assessment" before the end of March followed by a possible proposal in mid-April.

The idea marks a major shift in a previous proposal announced in late January that would only force companies to disclose the information to national tax authorities as part of its anti-tax avoidance package.

The original plan to limit access to national authorities was widely critised by pro-transparency groups like the Brussels-based European Network on Debt and Development (Eurodad).

But EU officials, for their part, say they have been working on the impact study since mid-September last year.

They want to assess "the objectives, the benefits, the risks and safe guards" of public country-by-country reporting. The report will be published once completed.

The idea has received wide support from EU tax commissioner Pierre Moscovici, capital markets commissioner Jonathan Hill, and Valdis Dombrovskis, the commission vice-president for the euro.

"It might be something as simple as companies being asked to publish their taxation information on their websites but it really depends, we won't really know until the impact assessment is finished and until the proposal is on the table," said an EU official.

Brake on document access

The future proposal follows a separate dispute between MEPs looking into corporate tax avoidance schemes and the European Commission.

MEPs in the European Parliament's special committee on tax rulings have until June to probe secret state-sanctioned tax busting deals tailored for multi-nationals.

The committee was launched after the LuxLeaks scandal broke in November 2014.

The International Consortium of Investigative Journalists (ICIJ) had found nearly 340 companies managed to slash their global tax bills after accountancy firms PwC, Ernst & Young, Deloitte and KPMG helped broker so-called sweatheart deals with tax authorities in Luxembourg.

While the parliament's tax committee has been granted to 415 confidential documents, some of them redacted, on tax information from 13 EU states, its say the conditions imposed by the Commission are too restrictive.

MEPs are not allowed to take notes and only three per political group is allowed access for limited time in a special reading room.

Fabio de Masi, a German MEP from the United Left, says they should have unlimited access to all the documents, including minutes of meetings held between member state tax authorities.

Last month he filed a lawsuit with the European Court of Justice in Luxembourg to force the commission to disclose the papers.

His lawyer wants the case accelerated so the MEPs can probe the files before their tax committee mandate ends in June.

"If this information is released a year from now, it would be a lot less useful to the work of the parliamentarians," said an European Parliament source.

MEP takes EU to court on tax transparency

An MEP has filed a lawsuit against the EU commission on document access, amid broader fight for transparency on how EU states manipulate tax deals with corporations.

Panama Papers: EU's Canete implicated in leak

Financial dealings of EU climate commissioner Canete are revealed in leaked documents called the Panama Papers, which also shed light on finances of the leaders of Iceland, Russia and Ukraine.

EU to toughen corporate tax disclosures

EU financial services Commissioner Jonathan Hill is set to present a bill to make it more difficult for big firms to hide their assets from tax authorities.

MEPs dispute details of corporate transparency bill

Companies operating in the EU will be required to report about their activities all over the world, country by country, but will be able to "omit" "commercially sensitive" information.

News in Brief

  1. VW owners to get diesel software update free until 2020
  2. Airbnb breaches EU consumer rules, Commission says
  3. EU sees no China free-trade talks
  4. Italy accepts migrant boat after help promises
  5. EU opens case on Siemens' Alstom buyout
  6. Trump: May found my Brexit advice 'too brutal'
  7. Italy will reject EU-Canada trade deal, says deputy PM
  8. Commission: Juncker suffered from sciatica attack at Nato

Stakeholders' Highlights

  1. IPHRCivil society asks PACE to appoint Rapporteur to probe issue of political prisoners in Azerbaijan
  2. ACCASocial Mobility – How Can We Increase Opportunities Through Training and Education?
  3. Nordic Council of MinistersEnergy Solutions for a Greener Tomorrow
  4. UNICEFWhat Kind of Europe Do Children Want? Unicef & Eurochild Launch Survey on the Europe Kids Want
  5. Nordic Council of MinistersNordic Countries Take a Stand for Climate-Smart Energy Solutions
  6. Mission of China to the EUChina: Work Together for a Better Globalisation
  7. Nordic Council of MinistersNordics Could Be First Carbon-Negative Region in World
  8. European Federation of Allergy and AirwaysLife Is Possible for Patients with Severe Asthma
  9. PKEE - Polish Energy AssociationCommon-Sense Approach Needed for EU Energy Reform
  10. Nordic Council of MinistersNordic Region to Lead in Developing and Rolling Out 5G Network
  11. Mission of China to the EUChina-EU Economic and Trade Relations Enjoy a Bright Future
  12. ACCAEmpowering Businesses to Engage with Sustainable Finance and the SDGs

Latest News

  1. EU and China agree on words, not yet on action
  2. EU is 'foe', as Trump seeks to make friends with Putin
  3. Let's not be 'naive' with Chinese partner, says senior MEP
  4. Trump, trade, and Brexit in EU headlines This WEEK
  5. EU and China edge closer in Trump's 'America First' world
  6. How the World Cup exposed Russian chauvinism
  7. Stage set for Trump-Putin finale
  8. Trump scuppers trade deal with UK under May's Brexit

Stakeholders' Highlights

  1. Nordic Council of MinistersCooperation in Nordic Electricity Market Considered World Class Model
  2. FIFAGreen Stadiums at the 2018 Fifa World Cup
  3. Mission of China to the EUChina and EU Work Together to Promote Sustainable Development
  4. Counter BalanceEuropean Ombudsman Requests More Lending Transparency from European Investment Bank
  5. FIFARecycling at the FIFA World Cup in Russia
  6. Nordic Council of MinistersOECD Report: Gender Equality Boosts GDP Growth in Nordic Region
  7. Centre Maurits Coppieters“Peace and Reconciliation Is a Process That Takes Decades” Dr. Anthony Soares on #Brexit and Northern Ireland
  8. Mission of China to the EUMEPs Positive on China’s New Measures of Opening Up
  9. Macedonian Human Rights MovementOld White Men are Destroying Macedonia by Romanticizing Greece
  10. Counter BalanceControversial EIB-Backed Project Under Fire at European Parliament
  11. Nordic Council of MinistersIncome Inequality Increasing in Nordic Countries
  12. European Jewish CongressEU Leaders to Cease Contact with Mahmoud Abbas Until He Apologizes for Antisemitic Comments

Join EUobserver

Support quality EU news

Join us