Sanctions will be introduced in relation to banks and auditors who provide assistance in tax evasion

The draft law providing punishment for tax advisers for helping companies to evade taxes has already been developed by the European Union

Due to a lot of prominent cases when tax advisers provided assistance for companies in elaborating schemes according to which these companies reduced their legal tax liabilities by transferring their income to low-tax economic zones, the law was drafted stipulating punishment with regard to such unconscientious consultants.

The European Commission, as the executive authority of the European Union, prepared this measure with the possibility (in case of actual necessity) of making amendments to it.

Now, auditing companies, bankers and other tax advisers have an obligation to notify state bodies about tax planning schemes, which, to some extent, fall under the category of so-called "potentially aggressive tax schemes".

The Law under discussion is just an element of an extensive package of measures. The scandal with the “Panama Papers” is considered as the beginning of application of the law by the European Union. By identifying such leaks, it has become known that large companies are evading taxes in global terms, using carefully designed/thought out schemes.

Tax consultants will be required to inform the authorities on tax supervision of the jurisdiction in which they conduct their activities concerning the above infringements. The foregoing information will be provided to the administrations of other EU countries in an early warning format, which in turn will not allow to transfer profits to the country with lower tax rate.

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