Are we moving in the right direction? Public disclosure of tax information and other EC/EP proposals to reduce aggressive tax planning
Briefing paper for the TAXE Special Committee of the European Parliament IP/A/TAXE/2016-08
The first part of this note looks briefly at some of the proposals put forward by the European Parliament and the European Commission in the field of tax reform.
It argues that some proposals should affect current aggressive tax planning practices. However, some proposals might increase real economic distortions and it is unclear whether others will make much difference.
The second part argues that more radical reform is required. It considers in particular the reform proposal in corporate taxation put forward by the European Commission and European Parliament with the Common Consolidated Corporate Tax Base (CCCTB). The proposal has some clear benefits. In particular, it would remove transfer pricing issues amongst participating states. However, other options with more attractive properties should also be considered, such as a residual profit split system and a destination based cash-flow tax system. The third part concludes.