On 18 March 2015 the European Commission presented a package of tax transparency measures as part of its agenda to tackle corporate tax avoidance and harmful tax competition in the EU.
According to the official press release, the Tax Transparency Package aims to ensure that Member States are equipped with the information they need to protect their tax bases and effectively target companies that try to escape paying their fair share of taxes.
The package includes a legislative proposal introducing the automatic exchange of information between Member States on their tax rulings and a communication outlining a number of other initiatives to advance the tax transparency agenda in the EU.
The legislative proposal is a Council Directive amending Directive 2011/16/EU as regards mandatory automatic exchange of information in the field of taxation.
Directive 2011/16/EU provides for mandatory spontaneous exchange of information between Member States in five specific cases and within certain deadlines. However, the efficient spontaneous exchange of information in respect of advance cross-border rulings and advance pricing arrangements is hindered by several important practical difficulties (for instance the discretion permitted to the issuing Member State to elect which other Member States should be informed).
The proposal provides for mandatory automatic exchange of advance cross-border rulings and advance pricing arrangements. This would include communication of a defined set of basic information to all Member States, with the Commission adopting measures necessary to standardise the communication. Member States should also exchange the basic information to be communicated with the Commission.