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By Joe Kirwin
April 25 — Germany and other European Union members questioned the value of public country-by-country profit and tax reporting, a victory for leading European businesses trying to convince EU states to instead focus their efforts on reducing value-added tax fraud.
German Finance Minister Wolfgang Schaeuble, speaking April 23 after the conclusion of a meeting of EU finance ministers in Amsterdam, said public country-by-country reporting could be too easily manipulated.
“It might make great headlines, but we have to consider the impact and how efficient such an approach would be,” Schaeuble said. “We do have a plan to require multinational companies to supply country-by-country reporting to tax authorities. The value added of making limited information public is one that is not clear to me.”
Schaeuble's viewpoints were echoed by Swedish Finance Minister Magdalena Andersson.
“From the Swedish side, the value added is not all that obvious in making it public, since it's the tax authorities” that will receive the information and do the taxing, Andersson told journalists at an April 23 news conference. “To make it public, does it really increase the possibility to fight tax fraud and tax avoidance?”
Andersson also said public country-by-country reporting (CBCR) could hurt companies.
“The information to the public will be very general and you can draw the completely wrong conclusions from it,” she said. “A company can get a bad reputation wrongly. And if it only covers European-based companies, this can create a competitive disadvantage. You have to take these aspects into account.”......
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