Country By Country Reporting

Governments and the public should be able to ‘follow the money’ of multinational corporations around the globe

Country-by-Country Reporting (CBCR) would mean that all multinational corporations (MNCs) would have to report not simply on the totality of their global activity, but on a country-by-country basis.

Transparency In this way governments and the public could know exactly what economic activity each MNC is carrying out in each country. This is not currently the case. By increasing transparency, extensive and public country-by-country reporting for MNCs would place the current practice of shifting profits around the world in order to reduce their tax bills much more in the public spotlight.

Some progress on country-by-country reporting for MNCs was made in June 2013, during Ireland’s Presidency of the EU, when the EU Accounting Directive introduced new country-by-country disclosure requirements for the extractive and forestry industries. Tax justice activists want to see these requirements broadened out to include all MNCs.

In September 2014, the OECD announced a new reporting template for country-by-country reporting. This would require MNCs to report annually, and for each tax jurisdiction in which they do business, in a number of areas, including the amount of revenue, profit before income tax, and income tax paid, as well as on numbers of people employed. However, a key criticism of this outcome is that the reporting, when it happens, will not be made public, a real blow to tax transparency and the focus on tax justice campaigning now.

Country by Country reporting (taken from Tax Justice Network)
Country-by-country reporting would require each transnational corporation to provide the following information:
(1) The name of each country where it operates.
(2) The names of all its subsidiaries and affiliates in these countries.
(3) The performance of each subsidiary and affiliate, without exception.
(4) The tax charge in its accounts of each subsidiary and affiliate in each country.
(5) Details of the cost and net book value of its fixed assets in each country.
(6) Details of its gross and net assets for each country.

DDCI asks the Irish Government to support full country-by-country reporting for all multinational companies as a vital tool for increased tax transparency, and as a step towards tax justice. This reporting to should available to the public and to all governments, not just those of the country where the reporting company is operating.