EU Commission admonished Austria and five other EU states again because they violated an EU directive Tax evasion large corporations have not been fully implemented. The EU law passed in 2021 is intended to force companies with a turnover of more than 750 million euros to make public declarations about how much they pay to the tax authorities in which country.
Due to delays in the implementation of the Directive on public country-by-country reporting („Country-by-Country-Reporting Directive“) will undermine the goal of “maintaining citizens’ trust in the fairness of national tax systems,” according to a press release from the EU Commission. In addition to Austria, Belgium, Italy, Cyprus, Slovenia and Finland are also being criticized.
Up to and including infringement proceedings
If the countries do not respond to the letter of formal notice within two months, the Commission can issue a reasoned opinion and thus initiate the next procedural step. At the end of a so-called infringement procedure, there can be a lawsuit before the European Court of Justice and a fine.
It is of course questionable whether this will ever happen. It is late, but the Federal Government sent the relevant implementation law for review on April 3. However, the text is clearly not yet sufficient for Brussels.
Criticism from SPÖ
SPÖ MEP Evelyn Regner, who led the negotiations on the directive as rapporteur, is therefore not sparing in her criticism. “The ÖVP opposed it from the beginning and tried everything to prevent the directive. It was only after we put pressure on them that the black-green coalition finally agreed,” says Regner. The Commission immediately returned the legislative proposal from Vienna with an “unsatisfactory” rating, says the MP.
Possible sanctions for violations of the law were apparently the sticking point in the negotiations between the ÖVP and the Greens. It was agreed on a two-stage criminal procedure: In addition to so-called mandatory penalties of up to 100,000 euros if the reports are not delivered on time, there should also be administrative penalties of up to 100,000 euros if the companies report falsely or state that they are not required to report. With reference to the Signa case, the Greens would also like to see similar fines for Austrian companies for false information in the company register.
High time
The EU-Policy for the so-called “Country-by-Country Reporting” was already passed in the EU Parliament in November 2021. Within 18 months – i.e. by June 2023 – the member states should implement the law at the national level. It was now high time to pass the law, said Justice Minister Alma Zadic the presentation one and a half months ago. According to the government’s plans, the new regulations should apply in the National Council in June, according to the EU requirements.