EU Council and Parliament agree text of country-by-country reporting Directive

The new text will require multinational companies and independent enterprises with total annual revenue above EUR750 million to publish their income tax information in each EU Member State.

It also requires separate reporting of tax paid in every country that is either named on the EU list of non-cooperative jurisdictions for tax purposes, or listed for two consecutive years on its 'grey list' of jurisdictions that have promised but not yet achieved tax cooperation. Reporting of numbers for other third countries will not be required.

Reporting must take place within 12 months from the date of the balance sheet of the relevant financial year and will include the name of the ultimate parent undertaking or the standalone undertaking; nature of the activities; number of employees; total net turnover; profit made before tax; amount of income tax due in the country from current profits; amount of tax actually paid; and accumulated earnings.

Companies will be able to apply to defer disclosure of commercially sensitive information for up to five years. However, this exception will not apply to information relating to black- or grey-listed jurisdictions.

The draft text will now be submitted back to the Council and Parliament for endorsement by the Committees on Economic and Monetary Affairs and Legal Affairs, with a vote in plenary session expected after the summer recess. Once finally agreed, the Directive will be deemed to have been adopted and Member States will have a further 18 months to transpose it into national law. The first reporting period will be the year starting on or after one year following the transposition deadline.

Sources

• Council of the European Union
• European Parliament
• EU (compromise text of agreement, PDF)
• Council of the European Union (statement by opposing members, PDF)