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EU wants big companies to reveal national tax bills

EU wants big companies to reveal national tax bills
The EU is urging big companies to disclose the tax bills paid in each country where they operate in order to reduce tax avoidance among multinationals.

The European Commission's official in charge of drafting business regulation Michel Barnier says the authorities have already oblige banks to report their profits, taxes and subsidies, and starting from 2015 it will apply to other big companies, reports Reuters.

"We will expand these reporting obligations to large companies and groups," he said on Thursday.

The move was triggered by the revelation of tax avoidance schemes by Apple and other major international businesses. Governments have been complaining that corporate tax avoidance has become a serious international problem.

This week the US Senate issued a report on its investigation into Apple's tax avoidance schemes. In the report the Senate accuses Apple Inc. of shielding around $74 billion in taxes via a complex web of subsidiaries that were tax residents in no country.

CEO Tim Cook denied all the accusations, saying the company contributes a lot to the US economy and has said Apple complies with the spirit and the letter of the law.

"We don't depend on tax gimmicks," Cook told a Senate Subcommittee hearing. "We don't stash money on some Caribbean island."

Apple is not the only big company that has faced tax disputes. Google, Starbucks and Amazon are under scrutiny of the UK government which is currently checking their tax integrity. Starbucks pledged to pay an extra £20 million in UK tax last year.

Governments have displayed a clear intention to force big businesses to report profits. Earlier this year the EU agreed to force European banks to report on a country-by-country basis. The US and the EU have also agreed to oblige mining and oil companies to publish tax and other payments to resource rich nations, to reduce corruption, Reuters reports.