Brussels, 29/03/2016 (Agence Europe) - The insurance industry has advised the European Commission against moving forward with a proposal for the public country-by-country reporting of accountancy information in the EU.
In a position statement published on Tuesday 29 March, the GFIA (Global Federation of Insurance Associations) argues that reporting to the administrations, as proposed in the framework of amendments to the directive on administrative cooperation and approved by the European ministers of finance, “is sufficient” to comply with OECD standards and allow the tax authorities to have the information they need. Publishing the reports would not simply go beyond the OECD recommendations but, even though the reports would remain anonymous, could even lead to the disclosure of business secrets and would be anti-competitive. Finally, the GFIA stresses that the USA has announced that it will cease exchanging accountancy information with any jurisdiction which publishes them, a risk of which the European Commission was well aware (see EUROPE 11510, 11516 and 11517). Its draft proposal provides for country-by-country reporting for the member states and overall reporting for the rest of the world.
As for the Commission's intention to have a European list of tax havens, the GFIA argues that third countries should be assessed on the basis of the existing OECD standards, whilst the Commission states that it wishes to establish criteria. “Going further than these international standards and effectively asking non-EU jurisdictions to comply with any EU standards which differ from the OECD standards would not, in our view, be a reasonable approach”, the GFIA states.
Lastly, the insurance industry calls upon the Commission to recognise that hybrid regulatory capital was not designed in order to create tax mismatches and that its use does not constitute a harmful tax practice: “this type of capital is very useful to insurers, for regulatory and commercial reasons. Therefore, hybrid regulatory capital should be exempted from any additional tax burden”, the GFIA concludes. (Original version in French by Elodie Lamer)