EU Agrees to Restrict Cross-Border Mergers That Aim to Lower Tax

Companies that engage in cross-border mergers to lower their tax bill are likely to be stopped in their tracks as EU countries are set to have new powers to reject such moves.

The new powers following a compromise between EU countries and the European Parliament means countries can, for the first time, impose conditions and restrictions on company movements within the single market.

“We fully support companies that move to other member states for genuine economic activity but not for those that do it to pay lower tax rates,” European Parliament member Evelyn Regner told Bloomberg Tax March 14.