European Union: Public country-by-country reporting in the EU off the tracks, for now

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

European Union: Public country-by-country reporting in the EU off the tracks, for now

Sponsored by

sponsored-firms-pwc.png
intl-updates-small.jpg

During a debate at the European Parliament in mid-April 2018, a representative from the Council of the European Union confirmed to members of the European Parliament (MEPs) that there were "unresolved political issues" which prevented agreement at the council on the European Commission's April 2016 pending proposal for public country-by-country reporting (public CbCR). The two largest parties in the European Parliament, the EPP (Christian Democrats) and the S&D (Social Democrats), asked the council to unblock the negotiations on the proposal for public CbCR. This was generally understood to be the last chance to reach a deal as Austria, which holds the six-monthly rotating EU Council presidency from July 1 to December 31 2018, and could drive discussions in the council forward, is not in favour of the commission's proposal. Germany's new Federal Finance Minister Olaf Scholz said in June 2018 that the German government needed more time and he also counselled caution about the Commission's proposal and hinted at following a tax-centric approach instead.

Indeed, one of the thorniest political issues surrounding the Commission's protracted 2016 draft directive is its legal base, which has divided the EU's member states as well as the EU's institutions from the start. Both the legal services of the European Parliament and the European Commission have taken the formal view that there is no conflict in the Commission's choice of the legal basis for its proposal, since the draft public CbCR directive in their opinion is a tax transparency financial reporting tool, and not a fiscal matter as such, which would require unanimity voting in the Council (giving each of the EU-28 individual member states a right to veto the proposal). The Council's legal service however does not agree with its counterparts at the Parliament and the Commission.

Members of the European Parliament have expressed their discontent with the now prolonged impasse around public CbCR, arguing that some EU member states are using the legal basis issue as a pretext to delay any meaningful negotiations on this file.

EU Tax Commissioner Pierre Moscovici indicated in April 2018 that a deal would probably not be reached within the Juncker Commission's mandate which ends on October 31 2019.

more across site & shared bottom lb ros

More from across our site

It should be easy for advisers to be transparent about costs, Brown Rudnick partner Matthew Sharp said in response to exclusive ITR in-house data
The sprawling legislation phases out Joe Biden-era green tax incentives for businesses; in other news, the UK will reportedly maintain its DST despite US pressure
New French legislation should create a more consistent legal environment for taxing gains from management packages, say Bruno Knadjian and Sylvain Piémont of Herbert Smith Freehills Kramer
The South Africa vs SC ruling may embolden the tax authority to take a more aggressive approach to TP assessments, an adviser tells ITR
Indirect tax professionals now rate compliance as a bigger obstacle than technology and automation; in other news, Italy approved a VAT cut on art sales
AI-powered tax agents are likely to be the next big development in tax technology, says Russell Gammon of Tax Systems
FTI Consulting’s EMEA head of employment tax and reward tells ITR about celebrating diversity in the profession, his love of musicals, and what makes tax cool
Canadian Prime Minister Mark Carney and US President Donald Trump have agreed that the countries will look to conclude a deal by July 21, 2025
The firm’s lack of transparency regarding its tax leaks scandal should see the ban extended beyond June 30, senators Deborah O’Neill and Barbara Pocock tell ITR
Despite posing significant administrative hurdles, digital services taxes remain ‘the best way forward’ for emerging economies, says Neil Kelley, COO of Ascoria
Gift this article