EU regulators demand tax transparency from multinationals

Tax avoidance by multinational corporations will be forced into the open under proposals to be unveiled by European regulators on Tuesday following the Panama Papers revelations.

The European Commission will put forward legislation requiring large multinationals operating in Europe to disclose profits earned and taxes paid in each of the EU's 28 member states, as well as fiscal havens, The Guardian reported.

All large companies trading in Europe, including subsidiaries of non-European businesses, would have to publish how much tax they pay outside the EU, including detailed country-by-country information on their finances in tax havens.

The commission was already working on measures to force international companies to disclose their earnings and tax bills in the EU. Following the leak of 11.5 million files exposing the tax secrets of the global elite, officials have toughened up their plans to include tax havens.

Lord Hill, the European commissioner in charge of financial services, confirmed on Monday that the proposals were being extended to tax havens, in response to the public outcry over the revelations in the Panama papers.

The massive data leak had "shifted the public mood" and it was sensible to reflect that in the proposals, he said.

The original proposals were drawn up after public outcry over large corporations, such as Apple and Starbucks, paying little tax despite earning healthy profits. The EU loses up to 70 billion euros a year through corporate tax avoidance, according to the European parliament.

Under the plans all multinational companies with a turnover greater than 750 million euros would be obliged to meet tougher standards on public disclosure.