Some leaders criticized Luxembourg’s reluctance and said that the EU would appear weakened in its negotiations with third countries if it can’t even get those rules agreed within its 27-nation bloc.
“It is essential that we fight all sources of tax evasion and tax havens,” insisted French President Francois Hollande.
The leaders were also set to discuss how to curb large companies’ aggressive tax planning, which allows them to take advantage of loopholes to redistribute their profits globally to minimize their tax payments.
According to a draft summit conclusion obtained by The Associated Press, the leaders are urging rapid progress in the “efforts taken against aggressive tax planning, profit shifting, lack of transparency and harmful tax measures to be pursued globally,” vowing to lobby for more international cooperation on the matter.
The investigation of the tax tactics of multinationals is being carried out on a global scale. On Tuesday, members of a U.S. Senate subcommittee grilled Apple Inc. (NASDAQ:AAPL) CEO Tim Cook over allegations that the company’s Irish subsidiaries help it avoid billions in U.S. taxes.
The subcommittee released a report Monday that said Apple Inc. (NASDAQ:AAPL) paid $6 billion in taxes last year. But the subcommittee estimates that Apple Inc. (NASDAQ:AAPL) avoided at least $3.5 billion in U.S. federal taxes in 2011 and $9 billion in 2012 by using a complex setup involving Irish subsidiaries as being a key factor.
Cook insisted that the company’s overseas operations have nothing to do with reducing Apple Inc. (NASDAQ:AAPL)’s U.S. taxes.
“We pay all the taxes we owe — every single dollar,” he said. “We don’t depend on tax gimmicks.”
Irish Prime Minister Enda Kenny denied Ireland was cutting special deals with multinationals.
“Ireland has been one of the frontrunners, and will be, in regard to building a new international consensus,” Kenny said.
In London last week, U.K. lawmakers criticized Google Inc (NASDAQ:GOOG)’s tax structure at a special Parliamentary committee hearing. Committee chairwoman Margaret Hodge accused the company of “devious, calculated and, in my view, unethical behavior in deliberately manipulating the reality of your business in order to avoid paying your fair share of tax to the common good.”
Google Inc (NASDAQ:GOOG) Vice President Matt Brittin defended his company’s complex corporate structure at the hearing, adding that Google Inc (NASDAQ:GOOG) was transparent about how it paid its bills.
The article EU Leaders Discuss Fight Against Tax Evasion originally appeared on Fool.com.
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