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EU Tax Transparency Rules Agreed

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On Tuesday, the EU agreed to new tax rules designed to increase the transparency of multinational companies with established operations in tax haven countries for the purpose of tax avoidance, but some NGOs say the rules don’t go far enough.

According to the EU rules, such corporations whose worldwide revenues exceed EUR 750m annually will be obliged to declare their profits and how much tax they’ve paid in tax as well as how many employees they have in EU member states.

While the rules may be designed to address tax avoidance, critics point out that the measures don’t actually force enterprises to pay more tax, only compelling corporations to publish how much tax they’ve paid in the EU and in those places on the EU tax havens list, meaning there is still room for avoiding full disclosure. But some MEPs believe the new rules will have an effect given that 80% of the profit-shifting of multinationals in Europe is among the EU’s 27 member states.

The rules still must undergo formal approval by both the European Parliament and Council.

Sources: DW, Politico

CET Editor

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