Since the Luxleaks scandal was revealed, the European Parliament is heavily involved in developing more stringent rules to tackle tax fraud. A special committee was created to look at what went wrong and to propose measures to improve transparency, better co-ordination and to close the existing loopholes.
A set of measures aimed at fighting aggressive tax planning which drains billions of euros from member states' budgets has now been adopted by the European Parliament. The report underlines our determination to produce real legislative change to stop tax dodging by big multinational firms. By introducing effective laws at EU level, we can prevent companies jumping across borders to reduce their tax bills to almost zero.
Among the measures proposed to improve transparency, co-ordination and convergence in tax policy are:
- Mandatory and public country-by-country reporting to increase transparency
- A Common Corporate Consolidated Tax Base (CCCTB) – a single set of rules for cross-border companies to calculate their taxable profits in the EU
- Protection for whistle-blowers
- A common and cogent definition of 'tax havens'
- Counter-measures for companies who make use of tax havens
- Automatic exchange of information on tax rulings (the 'sweetheart deals' for multinationals offered by governments) to be extended to all tax rulings and made public to a certain extent
- Mandatory notification of new tax measures
- Tighter controlled foreign corporation (CFC) rules to limit the use of offshore low-tax territories
- Publication of registers of beneficial ownership to counter money laundering
- A stronger mandate and improved transparency for the Council's Code of Conduct Group (Business Taxation)
Neena is a Member of the Committee on Economic and Monetary Affairs and a Member of the Special Committee on Tax Rulings and Other Measures Similar in Nature or Effect.