Financial loopholes for corporations will be closed by the European Union in the nearest future

EU closes tax loopholes for corporations

The decision concerning change of the tax legislation in the direction of closing the loopholes used to avoid paying income taxes (income is declared in the third countries having the lowest tax rate) by transnational corporations was adopted at the meeting in Brussels by the Minister of Economy and Finance of the Member States of the European Union. Entry into force of the new directive is scheduled for 2020.

Edward Scicluna, the Minister of Finance in Malta, stressed that the said draft law was adopted with the aim of putting an an to "hybrid disagreements" regarding the tax systems of third countries.

Also, this directive is designed to prevent tax evasion by large companies, so that these companies were unable to use the differences between two or more tax jurisdictions in order to reduce the total amount of their tax obligations as they did before.  

Last year in August, state aid and tax incentives granted to Apple Inc. in Ireland have been recognized by the European Commission as illegal, and after that Apple company has pledged to reimburse 13 billion euros.

And as it became evident hereinafter, it was not the only occasion. The European Commission became interested in the tax schemes of such companies as Amazon, Google, Starbucks, etc.