Multinationals could be required to disclose tax information
- Multinationals must publicly disclose how much tax they pay, and where
- Disclosure includes taxes paid outside the EU
- Measures would embrace companies with worldwide turnover of €750 million or more
Large firms must make information about the tax they pay in each country in the world, publicly available, say the Economics and Legal Affairs committees.
A proposal requiring multinationals to report their tax bills, on a country-by-country basis – with possible exemptions in the case of commercially-sensitive information – was approved by 38 votes to 9 votes, with 36 abstentions. The aim is to increase tax transparency by providing the public with a picture of the taxes paid by multinationals, and where those taxes are paid.
The Committees also voted to allow firms to apply for exemptions to authorities in member states, relieving them of the obligation to reveal tax details in order to protect commercially‑sensitive information.
These measures are a bid to crack down on corporate tax avoidance, which is estimated to cost EU countries EUR 50-70 billion a year in lost tax revenues, according to the European Commission.
After approving the draft report, the Committees failed to reach the qualified majority needed to enter into negotiations with the Council by 38 votes to 38, with 6 abstentions. Instead the draft report will go to Plenary.