European Parliament committee to investigate tax ruling practices of EU states

The European Parliament voted February 12 to establish a special committee to investigate the tax ruling practices of EU member states.

The 45-member committee will investigate ruling practices and “other measures similar in nature or effect” in place since January 1, 1991.  It will also “review 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 investigate and 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.

The establishment of the committee is more fallout from the November 5, 2014, “Lux Leaks” disclosures, where the extent of Luxembourg’s complicity in MNE tax avoidance was revealed through 548 Luxembourg private tax rulings that were leaked and published on the Internet by a journalist group. The European Commission is now looking into the tax rulings practices of all member states to determine if state aid rules have been violated.

See:

• European Parliament release

Related MNE Tax articles:

• EU Parliament leaders block call for inquiry into EU tax rulings, opting for special committee

• Proposal for committee inquiry into EU tax rulings practices moves forward in European Parliament