The European Commission today unveiled a package of reforms aimed at tackling corporate tax avoidance by boosting transparency between Member States, revamping outdated laws, and implementing measures to ferret out multinational companies that aren’t paying their fair share.
The Tax Transparency Package is designed to help the 28 members of the bloc better protect their tax bases and ensure fair tax competition, using a multi-pronged approach. Central to the package is a legislative proposal to implement greater transparency between Member States on cross-border tax rulings. Currently, Member States have broad discretion to determine if a particular tax ruling is relevant to another country, resulting in very little sharing of information and a lack of awareness about tax rulings elsewhere that affect their own tax bases. The commission says certain companies are exploiting this lack of transparency to artificially reduce their tax bill.
