Today the EU Commission launches proposals on public Country by Country Reporting (CBCR) for all companies. Greens were instrumental in achieving public CBCR for banks and have been pushing for this to be extended to all sectors. CBCR is one of 10 steps to tax justice that Greens are calling for. They say public CBCR will ensure the public disclosure of where companies do business and where they have subsidiaries, employ people, declare profits and pay taxes as well as where they have assets and receive public subsidies.
The proposals come in the wake of the Panama Papers revelations in which David Cameron has become deeply embroiled. He has sought to draw a line under the controversy by publishing his tax returns for the past five years. Molly Scott Cato MEP, Green Party speaker on economy and finance and a member of the European Parliament’s special committee on tax, said:
“Cameron cannot draw a line under the revelations in the Panama papers as his own personal tax affairs are not the heart of the issue. It is tax policy that is key here and this is political not personal. What we need is full transparency of what companies earn where, not simply the tax records of wealthy individuals, interesting and revealing as these may be. Public CBCR is a measure that can help create the transparency needed to hold corporations to account. It is another example of where the EU seems to be more progressive than the Tory government which is at best lukewarm on genuine transparency.”
Greens would like the proposals to go further but Molly says the Commission is being held back from greater ambition by national governments:
“The Commission is only proposing reporting obligations for firms’ activities in European countries. We will only have true tax transparency if corporations are obliged to publicly list their profits and tax payments in all countries where they do business. The commission has also suggested limiting the reporting obligation to firms which generate more than €750 million in revenue per year, seriously reducing the number of companies covered. These proposals are definitely a step forward but the Commission is being held back from going further because of individual countries’ addiction to tax competition, something the Tories are cheerleaders for.”
Molly says Tory MEPs voted against public CBCR in the European Parliament last year and is challenging Cameron to come clean on tax avoidance:
“Cameron needs to put his money where his mouth is on tax policy. The public need to know whether the government is genuinely committed to transparency on tax affairs. With Osborne an apparent new convert to the idea of public CBCR, perhaps he could have a quiet word with Tory MEPs and ask them to stop trying to block this important measure in the European Parliament; a measure which will work for the common good of all Europe’s citizens.”