Brussels, 29/05/2015 (Agence Europe) - The European Federation of Accountants (FEE) says in a letter to MEPs on the European Parliament's economic and monetary affairs committee dated Thursday 28 May that “it must not be forgotten that business is now truly global so, in order that the EU is not disadvantaged economically, it is important that third countries also exchange information about tax rulings”.
Earlier in the week, Switzerland said it only wanted to work on exchange of information on tax rulings based on the OECD's guidelines, which it says differ from the European Commission's proposals (see EUROPE 11322). Pascal Saint-Amans, Director the OECD's Centre for Tax Policy and Administration, told this newsletter that he could confirm that the OECD's mechanism was the equivalent of the EU's bar a few minor details.
“Tax rulings are important to the economies of Member States and it is vital that access to them is not curtailed in the future”, says the FEE, which says it fully backs the European Commission's proposal to make exchange of information on tax rulings automatic via amendments to the directive on administrative cooperation (2011/16/EU).
The FEE states, however, that “for Member States to properly implement the transmission of advance rulings and to analyse the information that they receive without negatively impacting on the willingness of their tax authorities to issue such rulings, it may be necessary for Member States to provide additional budgetary resources to their tax authorities. This could be a particular issue where tax authorities have previously been subject to budgetary cuts and also where Member States operate a federal system and such advance rulings would also need to be disseminated from the federal tax authority to regional authorities. Consequently, we believe that it is important that the Commission expedites the introduction of its proposed central directory of advance rulings, accessible to all Member States , as this would facilitate and enhance the exchange of Information”.
The FEE says that, under the directive on administrative cooperation, “the information being transferred will follow the tax secrecy laws in force in the recipient Member State rather than that from which it is sent. However, it needs to be considered that the Member State receiving the information may have different rules relating to tax transparency than the Member State sending the information”.
As for the measure making the exchange of information on tax rulings retroactive for ten years in the past, “this could result in an as yet unquantified number of cases having to be screened in Member States”, warns the FEE. The member states seem to be moving in the direction of reducing this to five years.
Transparency International wants the Commission to act faster. The NGO Transparency International regrets that there will not be any further details on country-by-country reporting in the action plan to be unveiled by the European Commission on 17 June. The Commission will simply announce the holding of a public consultation on the issue (as it hinted in March).
The NGO states: “What is frustrating is the pace of decision-making and the vagueness of the commitments, which seem to indicate a reluctance of the Commission to get to grips with the topic, despite the urgent need for transparency that was demonstrated by the LuxLeaks revelations. At a minimum, three months after the initial announcement, one would expect a detailed timeline for the consultation and the impact assessment, who will carry it out and what evidence they will assess”.
Transparency International goes on: “We were anticipating more detail on this in the public statement to be released on 17 June, but from the leaked document it seems that the only new element is a public consultation that will be held to feed into the impact assessment. One further hoop to jump through...”. It is said that, unless the public consultation is disastrous, then changes will be made to the accounting standards directive. Commission Vice-President Valdis Dombrovskis told a handful of reporters on Wednesday that the Commission was looking at this very seriously. (Élodie Lamer)