Brussels, 23/06/2015 (Agence Europe) - The Total oil company does not oppose country-by-country reporting but is concerned about the broad content found in draft OECD models for fighting the erosion of tax bases and the tansfer of profits (BEPS) of the OECD and the potential uneven playing field if only a handful of countries or companies are involved.
This was the view given by Nathalie Mognetti, Total's chief tax officer, at a hearing at the European Parliament's special TAXE committee with two other multinationals on 23 June.
Pointing out that as an extractive industry, Total will be subject to the rules in 2016, Mognetti regretted that only French and British companies faced this kind of fiscal transparency rule, and not their US counterparts. This concern about what is happening in the rest of the world is not only a question for companies but also for politicians. Decision-makers in countries that are the least advanced in terms of fiscal transparency stress the need to have a level playing field. The FATCA accords that introduced the automatic exchange of information were initiated by the United States, but the US is not really playing ball in this domain.
In charge of the BEPS plans at the OECD, Pascal Saint-Amans explained beforehand that in order to win a deal on country-by-country reporting, the condition laid down by the US, Japan and some EU countries was that information must be handed to tax offices (rather than to the public) (see EUROPE 11286). French finance minister Michel Sapin said in Riga in April that it would be complicated for the EU to apply public reporting if the US totally opposes it (see EUROPE 11301).
In the United States, the 'Tax Competition' network is exerting strong pressure. Since 2011, this network has been lobbying US Congressmen to get the US to stop funding the OECD. Earlier this year, a member of Tax Competition said: “We continue to believe that subsidizing the OECD provides a negative return for American taxpayers, who suffer from the harm to economic growth caused by the OECD's myopic efforts to eliminate tax competition. We're optimistic that many of the members of the next Congress, both new and returning, will be receptive to our message.”
At the TAXE committee, Martin McEwen, head of tax at energy company SSE plc, said that SSE had practiced voluntary country-by-country reporting, which was pretty simple to accomplish. The company is only active in two countries, which makes it easier, he admitted. McEwen said the right balance needed to be struck, with enough information that shareholders can understand but never disclosing commercially sensitive details.
Tax haven black list. Since its publication by the European Commission last week, the black list of thirty non-EU non-cooperating jurisdictions has been making waves. Mognetti welcomed its publication but said it was faulty. MEP Ana Gomes (S&D, Portugal) said the list was the fruit of political negotiations and any gaps were difficult to explain.
When they present their action plan to the EP, the president of the European Commission, Jean-Claude Juncker, and Taxation Commissioner Pierre Moscovici will probably be asked about how this European blacklist originated. French newspaper Le Monde says that in addition to the OECD, a number of jurisdictions seen as non-cooperative by Europe - Liechtenstein, Guernsey and the Bermuda Islands - have complained about being included on the list despite their efforts, alongside other jurisdictions that have not yet pledged to the exchange of information, Panama for instance. Le Monde says that the European Commission added together the eighteen national black lists without taking account of the fact that the member states use differing criteria. Moreover, some countries blacklists are reported to have not been updated for years. (Elodie Lamer)