MNEs shun European Parliament committee hearing on private tax rulings

Multinationals asked to testify about their private tax ruling practices before the European Parliament’s Special Committee on Tax Rulings on June 13 have mostly declined the invitation.

According to a June 9 European Parliament release, only one company, Total S.A., has agreed to appear before the committee, whereas eight companies — McDonald’s, IKEA, Google, Fiat Chrysler Automobiles N.V., Amazon Europe, AB In-Bev, and HSBC — have declined despite being offered alternative dates to appear.

MEPs have not yet been able to reach an agreement with the following companies regarding an appearance: Coca-Cola Company, Barclays Bank Group, Amazon Co. UK Ltd., Walt Disney Company, Facebook, and SSE plc.

“It is surprising to see that most of the multinationals initially decline to appear before our committee. If they stick to their refusal, it will come across as if they have more to lose than to win by being transparent about the way they fulfill their legal obligations in Europe. It is up to their shareholders, staff, clients, partners and all the EU citizens to decide what they make of that,” said the chair of Parliament’s Special Committee on Tax Rulings, Alain Lamassoure (EPP, FR).

The special European Parliament committee, established February 12, is investigating the tax ruling practices of EU member states and “other measures similar in nature or effect” that have been in place since January 1, 1991.

It is also reviewing “the way the European Commission treats state aid in member states and the extent to which they are transparent about their tax rulings.” Additionally, the committee will make recommendations on the impact of aggressive tax planning on public finances.

In January, a proposal to establish a more powerful committee of inquiry to investigate EU states’ private rulings practices had gained the support of 192 European Parliament lawmakers, more than the required support of 25 percent of members to move forward. However, Parliament leaders later blocked the move, opting instead to allow Parliament to vote on only a more limited special committee.

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