Proposal for a Directive amending Directive 2013/34/EU as regards disclosure of income tax information by certain undertakings and branches (CBCR)

Author (Corporate)
Series Details COM (2016) 198
Publication Date 12/04/2016
Content Type , ,

Summary:

Legislative initiative presented by the European Commission in April 2016 relating to the disclosure of income tax information by multinational enterprises.

Further information:

The draft law aims to introduce public reporting requirements for the largest companies operating in the European Union (EU). It requires enterprises with global revenues exceeding €750 million a year to public key information on where they make their profits and where they pay their tax in the EU on a country-by-country basis (CBCR). The same rules would apply to non-European multinationals doing business across the EU. In addition, companies would have to publish an aggregate figure for total taxes paid outside the European Union. This proposal amends Directive 2013/34/EU (also known as the Accounting Directive), and it is closely linked to the revision of the Administrative Cooperation Directive.

This initiative is a result of a consultation conducted by the Commission on public reporting and further tax transparency in 2015. The proposal was adopted by the European Commission on 12 April 2016 as part of its Action Plan on a Fairer Corporate Tax System. The European Parliament adopted a mandate for negotiations on 4 July 2017, and a first-reading position on 27 March 2019. Despite a number of discussions on the matter, the Council of the European Union was for years unable to adopt a negotiating approach on this file. Member State representatives eventually adopted a negotiating mandate on 3 March 2021. An informal agreement between the co-legislators on a compromise text for the draft law was reached on 1 June.

Source Link http://eur-lex.europa.eu/legal-content/EN/ALL/?uri=COM:2016:198:FIN
Related Links
Commentary and Analysis
The Conversation, 13/04/2016: The new tax laws planned in wake of Panama Papers – and the crucial role of public opinion https://theconversation.com/the-new-tax-laws-planned-in-wake-of-panama-papers-and-the-crucial-role-of-public-opinion-57696
Euro|topics, April 2016: EU Commission reacts to Panama Papers https://www.eurotopics.net/en/156836/
EPRS: Briefing, July 2016: Publishing corporate tax information Country-by-country reporting for multinational enterprise groups [Initial Appraisal of a European Commission Impact Assessment] https://www.europarl.europa.eu/thinktank/en/document.html?reference=EPRS_BRI(2016)581420
EY: Global Tax Alert, 07/07/2017: European Parliament votes in favor of public Country-by-Country reporting in first reading https://www.ey.com/gl/en/services/tax/international-tax/alert--european-parliament-votes-in-favor-of-public-country-by-country-reporting-in-first-reading
Deloitte: Insights, August 2017: An Update on Public Country by Country Reporting (CbCR) https://www2.deloitte.com/ie/en/pages/tax/articles/cbcr-update.html
International Tax Review, 24/08/2018: European Union: Public country-by-country reporting in the EU off the tracks, for now https://www.internationaltaxreview.com/article/b1f7n0rbqw37gc/european-union-public-countrybycountry-reporting-in-the-eu-off-the-tracks-for-now
Global Alliance for Tax Justice: Letter, 31/10/2018: Lack of progress of EU negotiations on European Commission’s proposal for public country by country reporting https://www.globaltaxjustice.org/sites/default/files/Public%20CBCR_Brief_BMF_3110.pdf
EPRS: Briefing, April 2019: Public country-by-country reporting by multinational enterprises https://www.europarl.europa.eu/thinktank/en/document.html?reference=EPRS_BRI(2017)595867
OKFN Blog, 13/05/2019: Two years on, little action from the EU on public country-by-country reporting https://blog.okfn.org/2019/05/13/two-years-on-little-action-from-the-eu-on-public-country-by-country-reporting/
EUObserver, 08/02/2021: Portugal vs Germany clash on EU corporate tax avoidance https://euobserver.com/economic/150831
Ernst&Young: Tax Alerts, 26/02/2021: EU negotiations on public CbCR move forward as majority of Member States back proposal https://www.ey.com/en_gl/tax-alerts/eu-negotiations-on-public-cbcr-move-forward-as-majority-of-member-states-back-proposal
KPMG: Insights, 26/02/2021: Ministers discuss public Country-by-Country Reporting proposal https://home.kpmg/xx/en/home/insights/2021/02/etf-443-ministers-discuss-public-country-by-country-reporting-proposal.html
CSR Europe: News, 23/03/2021: Greater Corporate Tax Transparency with the Country-By-Country Reporting Directive https://www.csreurope.org/newsbundle-articles/greater-corporate-tax-transparency-with-the-country-by-country-reporting-directive
Social Europe, 05/05/2021: Pay your taxes where your profit is https://socialeurope.eu/pay-your-taxes-where-your-profit-is
Eurodad: Press Release, 01/06/2021: EU fails to introduce real public country by country reporting https://www.eurodad.org/eu_fails_to_introduce_real_public_country_by_country_reporting
ICIJ: Paradise Papers, 02/06/2021: EU tax transparency rules leave tax justice advocates craving more ambitious reforms https://www.icij.org/investigations/paradise-papers/eu-tax-transparency-rules-leave-tax-justice-advocates-craving-more-ambitious-reforms/

News
Politico, 12/04/2016: Commission announces tax transparency rules for multinationals https://www.politico.eu/article/commission-announces-tax-transparency-rules-for-multinationals/
BBC News, 12/04/2016: EU seeks more tax details from big firms https://www.bbc.co.uk/news/business-36025133
EurActiv, 12/04/2016: EU’s new tax haven blacklist doomed to failure, warn campaigners https://www.euractiv.com/section/euro-finance/news/eus-new-tax-haven-blacklist-doomed-to-failure-warn-campaigners/
EUObserver, 12/04/2016: EU commission wants tax haven blacklist https://euobserver.com/economic/133019
EUObserver, 12/04/2016: EU to toughen corporate tax disclosures https://euobserver.com/economic/133010
The Guardian, 26/02/2021: EU states back plan to expose big companies' tax avoidance https://www.theguardian.com/world/2021/feb/26/eu-states-back-plan-to-expose-big-companies-tax-avoidance
EurActiv, 26/02/2021: Portugal wins EU support for corporate tax transparency law https://www.euractiv.com/section/eu-council-presidency/news/portugal-wins-eu-support-for-corporate-tax-transparency-law/
Malta Today, 04/03/2021: MEPs get ready to lock horns in Council talks on tax disclosure for multinationals https://www.maltatoday.com.mt/news/ewropej/108111/meps_get_ready_to_lock_horns_in_council_talks_on_tax_disclosure_for_multinationals#.YEDSXI77SUk
The Irish Times, 01/06/2021: EU reaches deal to force multinationals to report profits by country https://www.irishtimes.com/business/innovation/eu-reaches-deal-to-force-multinationals-to-report-profits-by-country-1.4581445
Bloomberg, 01/06/2021: EU to Force Multinationals to Report Revenue in Each Country https://www.bloomberg.com/news/articles/2021-06-01/eu-to-force-multinationals-report-their-revenue-in-each-country
RTÉ News, 01/06/2021: EU agrees rules for corporate tax transparency https://www.rte.ie/news/business/2021/0601/1225476-eu-tax-multinationals/
Reuters, 02/06/2021: EU reaches deal on tax transparency for multinational firms https://www.reuters.com/business/eu-reaches-deal-tax-transparency-multinational-firms-2021-06-01/
Deutsche Welle, 02/06/2021: EU agrees to new tax transparency rules for multinationals https://p.dw.com/p/3uJoL
The Guardian, 02/06/2021: EU agrees to force multinationals to disclose tax, piling pressure on UK https://www.theguardian.com/business/2021/jun/02/eu-agrees-to-force-multinationals-to-disclose-tax-piling-pressure-on-uk

Official
EUR-Lex: SWD(2016)117: Staff Working Document accompanying the Proposal - Impact assessment http://eur-lex.europa.eu/legal-content/EN/ALL/?uri=SWD:2016:117:FIN
EUR-Lex: SWD(2016)118: Staff Working Document accompanying the Proposal - Executive summary of the impact assessment http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=SWD:2016:118:FIN
European Parliament: Legislative Observatory: Procedure File for Proposal on Disclosure of income tax information by certain undertakings and branches (2016/0107(COD)) https://oeil.secure.europarl.europa.eu/oeil/popups/ficheprocedure.do?reference=2016/0107(COD)
European Parliament: Legislative Train Schedule: Proposal on disclosure of income tax information by certain undertakings and branches - public country-by-country reporting https://www.europarl.europa.eu/legislative-train/theme-economic-and-monetary-affairs-econ/file-public-country-by-country-reporting
European Commission: Public country-by-country reporting https://ec.europa.eu/info/business-economy-euro/company-reporting-and-auditing/company-reporting/public-country-country-reporting_en
European Commission: Press Release, 12/04/2016: European Commission proposes public tax transparency rules for multinationals https://ec.europa.eu/commission/presscorner/detail/en/IP_16_1349
European Commission: Fact Sheet, 12/04/2016: Introducing public country-by-country reporting for multinational enterprises - Questions & Answers https://ec.europa.eu/commission/presscorner/detail/en/MEMO_16_1351
European Commission: Remarks by Commissioner Jonathan Hill on tax transparency rules for multinationals, 12 April 2016 https://ec.europa.eu/commission/presscorner/detail/en/SPEECH_16_1365
European Parliament: Press Release, 04/07/2017: Multinationals should disclose tax information in each country they operate https://www.europarl.europa.eu/news/en/press-room/20170629IPR78639/
European Parliament: Legislative Observatory: Resolution on the state of play on the proposal for a directive of the European Parliament and of the Council amending Directive 2013/34/EU as regards disclosure of income tax information by certain undertakings and branches (2016/0107(COD)), known as public country-by-country reporting https://oeil.secure.europarl.europa.eu/oeil/popups/ficheprocedure.do?reference=2019/2882(RSP)
European Parliament: Press Release, 24/10/2019: Get multinationals to disclose where they pay taxes, MEPs tell member states https://www.europarl.europa.eu/news/en/press-room/20191017IPR64572/
Party of European Socialists: News, 24/02/2021: PES ministers urge EU to take a step forward on combating tax evasion and fraud, call for corporate tax transparency https://www.pes.eu/de/news-events/news/detail/PES-ministers-urge-EU-to-take-a-step-forward-on-combating-tax-evasion-and-fraud-call-for-corporate-tax-transparency/
Portuguese Council Presidency: News, 26/02/2021: Have you heard of CBCR? https://www.2021portugal.eu/en/news/have-you-heard-of-cbcr-learn-what-it-is-and-how-it-can-contribute-to-increased-fiscal-transparency-in-the-european-union/
Council of the European Union: Press Release, 03/03/2021: Council approves greater corporate transparency for big multinationals https://www.consilium.europa.eu/en/press/press-releases/2021/03/03/council-approves-greater-corporate-transparency-for-big-multinationals/
European Parliament: Press Release, 04/03/2021: Delay is over: Work begins to shine spotlight on where companies pay their taxes https://www.europarl.europa.eu/news/en/press-room/20210301IPR98959/
Council of the European Union: Press Release, 01/06/2021: Public country-by-country reporting by big multinationals: EU co-legislators reach political agreement https://www.consilium.europa.eu/en/press/press-releases/2021/06/01/public-country-by-country-reporting-by-big-multinationals-eu-co-legislators-reach-political-agreement/
European Parliament: Press Release, 01/06/2021: EU lawmakers strike milestone deal for corporate tax transparency https://www.europarl.europa.eu/news/en/press-room/20210527IPR04913/
Portuguese Council Presidency: News, 02/06/2021: Agreement reached on greater tax transparency for multinationals in the EU https://www.2021portugal.eu/en/news/agreement-reached-on-greater-tax-transparency-for-multinationals-in-the-eu/
GUE/NGL: News, 02/06/2021: Corporate tax transparency deal opens door for shifting practices to tax havens https://www.guengl.eu/corporate-tax-transparency-deal-opens-door-for-shifting-practices-to-tax-havens/

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