Dividends, capital gains and other forms of financial income should be subject to automatic exchange of information among tax authorities beginning in 2015, according to a European Commission plan.
The Brussels-based commission aims to combine the new proposals with an existing effort to update tax-data sharing on interest from savings accounts. If approved by nations, the combination would rewrite bank secrecy laws across the 27-nation bloc to make it harder to dodge cross-border taxes.
“With today’s proposal, member states will be better equipped to assess and collect the taxes they are due, while the EU will be well positioned to push for higher standards of tax good governance globally,” EU Tax Commissioner Algirdas Semeta said in a statement. “It will be another powerful weapon in our arsenal to lead a strong attack against tax evasion.”
Semeta also said EU governments should work together on sharing tax data, rather than pursuing side deals like a U.K.- supported pilot program.
“I firmly believe that an EU approach is better than a patchwork of bilateral arrangements,” Semeta told reporters. “It prevents loopholes from emerging, creates greater legal certainty and ensures that all member states benefit from an inclusive stance against tax evasion.”
The U.K. and four other EU countries are slated to develop a program on automatic sharing of cross-border tax information with Caribbean territories and other overseas financial centers. Details aren’t yet available on the planned pilot program, which has been endorsed by 12 other EU nations.
The increased EU focus on fighting tax avoidance could rejuvenate negotiations within the 27-nation bloc for a common consolidated corporate tax base, Semeta said, citing “new momentum” for technical work on the plan, which faces opposition from Ireland, Luxembourg and other nations.