One week after the first ‘Panama Papers’ revelations, the European Commission published a patchy proposal for public country-by-country reporting which will not enable us to meet the challenge of transparency, though it is crucial in the fight against tax evasion.
The European Commission’s Directive Proposal would apply to multinational corporations which operate within the European Union, but only those whose global revenues exceed 750 million Euros. According to the OECD (1), this de facto excludes 85 % to 90 % of multinational corporations. Worse, these corporations would only be required to publish information concerning their activities and the taxes they pay in the European Union countries where they are established, and in those tax havens which appear on the EU’s list (2).
The Tax and Legal Havens Platform expresses its disappointment with this minimal proposal based on a list of tax havens which does not yet exist and will necessarily be non-exhaustive: it is likely that, due to political reasons, neither the United States nor Switzerland will be included. Corporations will therefore continue to be able to hide their profits in these countries.
Moreover, this proposal also excludes developing countries which lose at least 100 billion Dollars a year because of multinational corporations’ tax evasion practices. Indeed, unless they are included in the European Union’s list of tax havens, these countries will not have access to any information concerning these corporations’ activities and tax within their jurisdictions.
Last, the Tax and Legal Havens Platform reiterates that a requirement of complete reporting has existed since 2013 for European banks. They are required to publish information concerning their activities and the taxes they pay in every country where they are established, and our organizations do not understand what is preventing the Commission from simply proposing an extension of this requirement to all multinational corporations.
The Platform’s member organizations request the European Parliament and the Member States of the European Union to modify the European Commission’s proposal in order to require multinational corporations to publish information concerning their activities and the taxes they pay in every country where they are established.
They also reiterate that as long as public country-by-country reporting allowing for real transparency is not enforced, citizens such as Antoine Deltour, the Luxleaks whistleblower whose trial sill start on 26 April, will continue to pay the price of secrecy.
Spokespersons are available for interviews.
- See p. 4 of the document ‘Action 13: Guidance on the Implementation of Transfer Pricing Documentation and Country-by-Country Reporting’ (OECD 2015)http://www.oecd.org/ctp/beps-action-13-guidance-implementation-tp-documentation-cbc-reporting.pdf‘
- The new European Union list of tax havens should be published later this year.
Members of the Tax and Legal Havens Platform:
Sherpa- Les Amis de la Terre – Anticor – Attac France – CADTM France – CCFD-Terre Solidaire – CFDT – CGT – Collectif Roosevelt – CRID – Observatoire citoyen pour la transparence Financière Internationale – Oxfam France – Justice et Paix – Peuples Solidaires-ActionAid France -Réseau Foi et Justice Afrique Europe – Secours catholique Caritas France – Survie – Syndicat de la magistrature – Solidaires Finances Publiques – (www.stopparadisfiscaux.fr)
Partners : Transparency International France and ONE FranceLast modified: 17 December 2019