It only needs a finance minister who said no during a training session on taxation. Portugal, the rotating president of the European Union Council, has chosen a formation of ministers in the economy to include in the list the issue of transparency of multinational corporations established in one or more member states.
Tax transparency is a basic principle in any democratic society. It enables policy makers to make informed decisions and to ensure that all economic actors make a fair and equitable contribution to the economies of the various countries in which they operate. Today’s discussion paved the way for a progressive proposal, “said Pedro Cisa Vieira, Portuguese Minister of Finance and Digital Transit. The meeting was chaired by Finance Minister Franz Fiot (LSP).
A clear majority of ministers thought the presidency’s latest consolidation proposal was technically mature. They invited the Portuguese presidency to request without delay the possibility of an agreement to expedite the acceptance of the proposal to study with the European Parliament, ”he said in a press release issued at the end of the meeting. “The Portuguese presidency has concluded that there is political support for seeking approval for negotiations with the European Parliament to explore the possibility of an agreement to expedite the adoption of the proposed proposal.”
A “beautiful day” for Sven Geegold
The country-by-country report will include information on the amount of multinational enterprise group income, pre-tax profit, income tax paid and accumulated, number of employees, stated capital, retained income and explicit assets operating within each tax jurisdiction. This phrase only affects companies with a turnover of more than 50 750 million in the last two financial years.
“Today has been a frustrating day for me. For greater tax transparency, both for our democracy and for me personally, ”said Green MEP and European Greens spokeswoman Sven Geegold. The victory is also a testament to the success of all civil society organizations that have been fighting for more tax transparency for decades. When we set up the Tax Justice Network about 20 years ago, tax transparency was at the center of our agenda. In my little book ‘Sturosen: Trokenlegan!’ (“Tax Stations Are Drying Out!”) For more than ten years, I have been working to establish tax transparency for large European companies. At Greens’ request, we have already implemented tax transparency for banks, which is now at the discretion of all major companies. ”
In his opinion, eight countries, including Luxembourg and Germany, voted against or abstained (Ireland, Malta, Sweden, Czech Republic, Hungary, Cyprus).
“This measure should take advantage of tax expertise to keep pace with current requirements, especially international cooperation and information exchange agreements based on confidentiality,” said Robert Troy, Minister of State for Corporate Governance.
Luxembourg will not oppose the move
This is the view of the Luxembourg Finance Minister. Luxembourg does not oppose the basic tenets of the proposal, which states ‘public reporting’, with the aim of increasing transparency in tax matters, “Fiot said in a statement. “However, in the case of Luxembourg, the chosen legal basis for taking forward and negotiating this proposal is wrong. In this regard, it should be remembered that Luxembourg’s position is that the question of the appropriate legal basis for discussing and adopting tax regimes in the European Union is a question of principle, which cannot be discussed. As for the Grand Duchy, it is worrying that tax issues are being discussed and accepted outside the territory where European tax treaties are reserved, ”he regrets.
Luxembourg argues that the file relating to “public country by country reporting” falls within the scope of the tax and should therefore be handled in the ecofin sector. However, in light of the commitment to tax transparency, the Luxembourg Council will not live up to the objectives of the presidency, in relation to the proposal to publish information on a country-by-country basis, ”the minister said.
To the legal question, Myrish McGuinness, the Irish European Commissioner representing the European Commission in this discussion, thought the proposal was legally superior. “This proposal is in no way intended to change the tax laws applicable to businesses or to apply tax laws in the European Union or at the national level,” Ms McGinnon said. “I welcome the general opinion on the need for transparency on this issue.”
However, the fight for tax transparency is far from successful. The text does not take the place of MEPs, for example providing a very broad confidential close to protect the strategic interests of the companies involved.