European Council advances directive on public country-by-country tax reporting

By Doug Connolly, MNE Tax

The Council of the European Union on September 28 adopted its position on the proposed directive that would require large multinationals operating in the EU to publicly disclose certain information on the income taxes they pay on a country-by-country basis.

The Council had reached a provisional agreement with the European Parliament on the proposed directive on June 1 – five years after the proposed directive was first tabled. The European Parliament must now formally approve the agreement before the directive can enter into force.

The reporting requirement would apply to certain multinationals with total consolidated revenues of EUR 750 million (approximately USD 875 million), regardless of whether they are based in the EU. Such multinationals operating in more than one country in the EU would be required to publicly disclose income tax information on a country-by-country basis for EU member states and also for non-EU “black list” and “gray list” jurisdictions.

EU member states would have 18 months to transpose the directive into national law once it is approved and enters into force. The reporting would be due within one year of the end of the fiscal year being reported, although the directive would allow companies to defer reporting certain information for up to five under specified conditions.

Similar requirements are under consideration in the US, where advocates last week pushed for public country-by-country reporting requirements to be imposed via accounting standards. The US Financial Accounting Standards Board had indicated in June that it is looking into such enhanced disclosures to provide more information to investors on global tax risks.

• Bio
• Latest Posts

Doug Connolly

Editor-in-Chief at MNE Tax

Doug Connolly is Editor-in-Chief of MNE Tax. He has more than 10 years of experience covering tax legal developments, previously working with both a Big Four firm and a leading legal publisher. He holds a law degree from American University Washington College of Law.

Latest posts by Doug Connolly (see all)

• OECD transfer pricing guidelines get first update in five years - January 20, 2022
• EU’s path forward on global minimum tax is under debate - January 18, 2022
• Switzerland will implement global minimum tax by constitutional amendment - January 13, 2022
• UK sets out approach to global minimum tax implementation - January 11, 2022
• OECD’s ‘complex’ minimum tax rules have ‘major policy issues,’ BIAC says - January 7, 2022