New rules to improve global tax transparency

ECR MEPs have welcomed new legislation that aims to tackle corporate tax avoidance by large multinationals in the EU. The new rules, adopted by the parliament in Strasbourg today, will apply to multinationals with an annual turnover of more than €750 million and require them to publicly report where they pay their tax, on a country-by-country basis across the EU, as well as disclosing profit and loss, fixed assets and numbers of employees.

The parliament also introduced a ‘safeguard clause’ into the proposals to allow companies to remove from the public part of their reports commercially sensitive information if disclosure is likely to have a damaging effect on the company. In order to omit the information the European Commission and national authorities must approve the omission on an annual basis.

Speaking after the vote, ECR spokesman on the legal affairs committee, Sajjad Karim said:

“People have rightly been demanding more transparency from multinationals on what countries they pay tax in. These new proposals should improve public trust in global companies by strengthening transparency requirements and making information public.

“At the same time, we’ve ensured that we are not unfairly disadvantaging EU based firms by forcing them to disclose commercially sensitive or harmful information – they’ll be able to apply to omit certain data from their public reports.”

ECR Finnish MEP Pirkko Ruohonen Lerner who led for the group in the economic and monetary affairs committee added:

“While not perfect, the proposals are a clear step forward from our current rules towards a greater accountability and transparency of multinationals. We need this to ensure that taxes are paid where the business is made and to detect possible abuses.

“Hopefully the experiences gained through this legislation, as well as other new rules for reporting on natural resources and on banking, can be built upon to our benefit and to enlarge the scope of public reporting globally.”

The parliament will now enter negotiations with the council in order to reach an agreement on the legislation.

  • Email
  • Facebook
  • Twitter