The EU has moved to force multinational companies to publish a breakdown of the tax they pay in each of the bloc’s member states and in tax havens. Country-by-country reporting is designed to shine a light on how some of the world’s biggest companies avoid paying an estimated $500bn a year in taxes by shifting their profits from higher-tax countries such as the UK, France and Germany to zero-tax or low-tax jurisdictions including Ireland, Luxembourg and Malta.
A majority of EU countries backed legislation at a meeting of ministers on Thursday, in what campaigners said was a “landmark” moment, five years after the regulation was first proposed.
Negotiations will now open with the European parliament, which wants to broaden the scope of the regulation. MEPs want multinationals to make public their profits and tax paid in any country, rather than just member states or a blacklist of EU tax havens, as the price for operating in the bloc.
The decision by the member states to move forward with the proposal, was celebrated by senior MEPs who have campaigned for reform. Sven Giegold, the financial and economic policy spokesperson of the Greens group in the European parliament, said he hoped the move would put pressure on the UK to follow suit.
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