The European Union is pulling back the curtain on corporate tax practices. Under a directive that’s been years in the making, large multinational enterprises operating in the bloc will be required to publish detailed tax and financial information for each country where they do business.
Who’s affected and what they have to disclose
The Public Country-by-Country Reporting Directive, formally known as Directive (EU) 2021/2101, applies to multinational enterprises with consolidated global revenues exceeding €750 million in each of the last two consecutive financial years. That threshold captures a significant chunk of the world’s largest corporations, whether they’re headquartered in the EU or simply operate there at scale.
The required disclosures are granular. Companies must report a description of their activities, the number of full-time employees, net turnover, pre-tax profit or loss, taxes accrued, taxes actually paid, and accumulated earnings. All of this must be specified for each EU member state individually, plus any jurisdictions on the EU’s list of non-cooperative tax havens.
Banking groups are carved out from the rules entirely. They already face similar disclosure requirements under the Capital Requirements Directive, so the EU decided not to double up on reporting obligations.
