European Commission proposes public tax transparency rules for multinationals
29 April 2016
The European Commission is leading the way towards greater corporate tax transparency by proposing the introduction of public reporting requirements for the largest companies operating in the EU.
The proposal builds on the Commission's work to tackle corporate tax avoidance in Europe, estimated to cost EU countries EUR 50-70 billion a year in lost tax revenues. Supplementing other proposals to introduce sharing of information between tax authorities, it would require multinationals operating in the EU with global revenues exceeding EUR 750 million a year to publish key information on where they make their profits and where they pay their tax in the EU on a country-by-country basis.
The same rules would apply to non-European multinationals doing business in Europe. In addition, companies would have to publish an aggregate figure for total taxes paid outside the EU.
This proposal is a simple, proportionate way to increase large multinationals' accountability on tax matters without damaging their competitiveness. It will apply to thousands of large firms operating in the EU, without affecting small and medium-sized companies.
The proposal also provides for stronger transparency requirements for companies' activities in countries which do not observe international standards for good governance in the area of taxation. The Commission will build on its External Tax Strategy with the aim of establishing the first common EU list of such tax jurisdictions as rapidly as possible.
Read more from the European Commission.