By: Rupert Neate
November 27, 2019
European government ministers will vote on Thursday on a new directive that would require multinational companies to reveal how much profit they make and how little tax they pay in each of the EU’s 28 member states.
The proposed rule is designed to shine a light on how large companies avoid paying an estimated $500bn a year in taxes around the world by shifting their profits from higher-tax countries such as the UK, France and Germany to zero-tax or low-tax jurisdictions such as Luxembourg, Ireland and Malta.
It would make country-by-country reporting mandatory for companies with an annual turnover of more than €750m.
The vote comes more than three years after the European commission promised to expose multinational corporations’ tax avoidance measures following the Panama Papers revelations.