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THE HEADS of the 27 European Union member states have asked the European Commission to come up with a plan to address the concerns over “aggressive tax planning” by major multinational corporations.
The agreement between political leaders in Brussels comes only a day after Ireland came under international scrutiny for the tax arrangements exploited by companies like Apple and Google.
Leaders called on the European Commission, led by Jose Manuel Barroso, to formulate recommendations on how “aggressive tax planning” and “profit shifting” could be dealt with.
The Commission now plans to present a revised version of the ‘Parent/Subsidiary Directive’, a rule introduced in 2003 which abolished withholding tax on payments between related companies in multiple countries.
Tax-free payments between related companies in different EU member states is a key part of the ‘Dutch sandwich’ taxation system used by companies like Google.
In that system, an Irish company collects revenue for sales around the world, transfers it tax-free to a company in another EU state (usually the Netherlands), and then transfers it back to an Irish-registered company which is actually based in a low-tax jurisdiction like Bermuda.
The Commission said it would also review the current EU laws relating to abuse of the taxation system.
Today’s summit – one of the briefest European Council meetings in modern times – had been due to discuss tax evasion for several weeks, but the meeting took on an extra significance after a United States Senate committee asked Apple executives to give evidence about the country’s use of Ireland as a “tax haven”.
Asked how this latest drive against tax fraud and tax avoidance would make progress when others had failed, European Council president Herman van Rompuy said the economic crisis now meant there was an imperative on countries to ensure they were not losing income.
“What is different? The economic crisis makes the difference,” he said.
European Commission president Jose Manuel Barroso called on members of the public to maintain pressure on their political leaders so that the agreements reached today were followed through.
I hope the Gardai are closer to charging someone. This investigation went very quiet so hopefully that means they’ve pieced the puzzle together and now have the evidence to get justice.
As this is an ongoing investigation I think disabling comments on this article might be best. As great as it is that progress seem to be happening there just might be a chance of a few things being said that hinders this progress. Just a suggestion
Totally agree. Zero consistency with the journals closed comments policy
@Shane Mc Quillan: ya get sick of reading advice about closing the comment section all the time.. If you don’t want to read them, don’t read them!
@steovani: way to miss the point there chief.
So commenting on Paddy Jackson and his move to France isn’t ok – but for a murder case it is?
Post hoc ergo propter hoc.
@The IMF are here: I presume that is because there is still such venomous comments being written about a person found not guilty. For several weeks after the trial ended the hashtag was still about rape trial
@The IMF are here: will u ever f### off
@The IMF are here: get a life move on
Why, oh why can you not refer to the boy by his first name in this- and other sad tragedies. He is Cameron.
Horrendous crime – hopefully proper justice is served.
Why refer to the victim as a boy or teenager and the person bein questioned a man, when they are both the same age.
@Chris Kirk: The boy murdered was 13. The man who killed him was 18.
@Escay: not he wasn’t. Cameron Reilly was 18 when he was murdered.
#justiceforcameron
Gosh my advice taken! Thank you.
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