Tuesday, 21 June 2016

EU agrees moves against tax avoiders

One wonders whether a reluctance to submit to curbs on evasion and aggressive tax avoidance measures is the real motivation for the money-men funding the various sophisticated campaigns persuading us to leave the European Union.

Thanks to Catherine Bearder MEP for drawing our attention to today's media release reporting agreement new rules to tackle tax avoidance.

Once implemented, this legislation will put an end to the most common loopholes and aggressive tax planning schemes currently used by some large companies to avoid paying their fair share of tax. For example, all Member States will now have the power to tax profits being moved to low-tax countries where the company does not have any genuine economic activity (CFC rules). Previously untaxed gains on assets such as intellectual property which have been moved from the EU's territory can also be taxed (exit taxation rules), while countries have also been empowered to tackle tax avoidance schemes that are not covered by specific anti-avoidance rules (general anti-abuse rule).

This is another step in the right direction, but it has necessitated the agreement of member governments of the EU. Progress will clearly be at the pace of the most reluctant nations, the ones who benefit most from tax avoidance, such as Luxembourg and sadly the UK.

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