EU Member States have voted to adopt ‘country-by-country’ tax transparency measures, bringing an end to nearly five years of political wrangling and opening the doors for greater scrutiny on corporate tax affairs.
Yesterday, the EU Council, which represents the governments of Member States, approved requirements for companies with revenues above €750m to publish a breakdown of revenues, tax payments and other key financial data on a country by country basis.
The tax proposals were originally suggested by the European Commission in 2016, in the wake of public outcry over the Panama Papers leak, which revealed the widespread use of offshore tax havens by wealthy individuals and public officials.
The EU rulemaking process requires Council and Parliament to reach separate agreements on a legislative proposal before negotiations can begin over its formal adoption. Parliament backed the plans in 2017, leaving Council as the sole holdout.