EU Commissioner Jonathan Hill has just announced the latest
EU proposals for Country-by-Country Reporting….of sorts
Here are the broad elements of what he said. More considered commentary to follow...
All large MNE operating in Europe will have to publish the
taxes they pay on CBC basis.
This follows on the progress made:
- State Aid/selective tax advantages
- Automatic exchange of tax rulings
- Automatic exchange between tax authorities of tax information received from MNEs
Clearly Panama Papers has strengthened the resolve.
The EU proposals go further than the OECD proposals, by
making the disclosures public.
Greater transparency will shine a light, helping the public to see whether companies are acting in the best long-term interest of shareholders,
We have been guided by four principles:
- Consistent with international work by OECD and endorsed by G20
- Build of reforms already by Commissioner Moscovici
- Impact ALL large MNEs operating in EU, not just EU MNEs
- Protect competitiveness, including for SMEs.
The rules:
- MNEs with net revenue over €750m. This will catch 6,500 businesses and 90% of MNE revenue.
- MNEs must publish data (same as OECD template) within EU, plus the total tax for outside EU.
- Plus MNEs present in “countries that don’t abide by international standards of good governance around tax”, must disclose the same information on those countries. (Commissioner Hill specifically mentioned Panama as being on this list.)
- The information must be published on the company website for 5 years
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