The European  Commission proposed on Tuesday to introduce public reporting requirements for the largest companies operating in the EU and in tax havens in a bid to boost tax transparency.

The proposal aims to ensure that multinationals publish each year a report disclosing the profit and the tax accrued and paid in each member state on a country-by-country basis.

“The proposal builds on the Commission's work to tackle corporate tax avoidance in Europe, estimated to cost EU countries EUR 50-70 billion a year in lost tax revenues,” the EU executive said in a statement.

Once adopted, the new rules will apply to the approximately 6,500 largest companies operating in the EU with global revenues exceeding EUR 750 million a year without damaging their competitiveness and without affecting small and medium-sized companies, the Commission added.

The information which the companies will have to disclose such as turnover, number of employees and nature of activities will enable an informed analysis. The information will have to be disclosed for every EU country in which a company operates, as well as for tax havens.

“The proposal therefore also addresses concerns flowing from the Panama Papers,” the Commission said.

A year-long worldwide media investigation into a trove of 11.5 million documents, leaked from a Panama-based law firm with offices in 35 countries, has exposed a tangle of offshore financial dealings of political leaders, movie celebrities and sports stars.

The same rules would apply to all multinationals doing business in Europe. In addition, companies would have to publish an aggregate figure for total taxes paid outside the EU, the Commission said.

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