Saturday 20 January 2018

EU launches tax evasion crackdown

The EU's executive commission said it will table new tax legislation next month
The EU's executive commission said it will table new tax legislation next month

The European Union has launched a drive to combat tax evasion following a series of probes into rules that allow multinationals to slash their bills in Luxembourg, Ireland and the Netherlands.

The EU's executive commission said it will table new tax legislation next month including on the automatic exchange of information about tax rulings.

Commission vice president Valdis Dombrovskis said the EU "must reassure people that the tax burden is distributed fairly and the tax rules shall apply equally to all citizens and businesses".

The 28-country EU launched an investigation on February 3 to establish whether a Belgian tax provision allows some companies to substantially reduce their liabilities.

It opened probes last year into Apple in Ireland, Starbucks in the Netherlands and Amazon in Luxembourg.

EU countries share little information about corporate tax rulings, making it difficult for authorities to work out where a company's real business takes place and to apply the rules fairly.

The Commission said that many multinationals are taking advantage by shifting profits and that this deprives EU governments of tax revenues.

Last week, the EU set up a special committee to look into national tax rules following reports based on leaked documents that alleged deals were made for big multinationals in Luxembourg.

The European Parliament committee will examine a cache of leaked documents on those deals as well as other incidents of tax avoidance and evasion in Europe involving companies from around the world.

It will be similar to the one set up to probe prisoner rendition allegations against the CIA and will have the power to propose legislation to address any issues it uncovers.

Press Association

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