EU to make big firms come clean on tax

Plans to force the largest companies to disclose more about their tax affairs will be unveiled by the European Union on Tuesday.

Britain’s EU Commissioner, Lord Hill, is set to present the rules, which will affect multinational firms with more than €750m (£600m) in sales.

They will have to detail how much tax they pay and in which EU countries.

The plans come amid heightened scrutiny of the use of tax havens following the Panama Papers revelations.

Transparency

Lord Hill, the EU’s financial services commissioner, said: “This is a carefully thought through but ambitious proposal for more transparency on tax.

“While our proposal on [country-by-country reporting] is not of course focused principally on the response to the Panama Papers, there is an important connection between our continuing work on tax transparency and tax havens that we are building into the proposal.”

Country-by-country reporting rules already apply to banks, mining and forestry companies, according to an EU spokesperson.

Under the new proposals, that would be expanded to cover companies accounting for about 90% of corporate revenues in the EU, they added.

The BBC understands that companies will need to disclose information such as total net turnover, profit before tax, income tax due, amount of tax actually paid and accumulated earnings.

The changes come after G20 leaders agreed to follow an OECD action plan to tackle corporate tax minimisation.

 

 

 

 

Source: BBC NEWS

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