Cabinet wants more disclosure from multinationals, but privacy still weighs heavily

The Cabinet points to recent steps by the business community itself, such as the Tax Governance Code of VNO-NCW. This code of conduct, now endorsed by large international companies and also expected by state-owned enterprises, mandates openness on tax obligations and remittance. In addition, multinationals in the EU with a turnover above 750 million euros are subject to the obligation of public country-by-country reporting (CbCR), which requires disclosure of profit and tax data by country. The first report for fiscal year 2025 must be filed in the trade register by December 31, 2026. This, according to the cabinet, already enforces significantly more openness from companies.

Government transparency and fiscal secrecy

The motion also called attention to government disclosure of tax data. The cabinet emphasized sending an annual monitoring letter to the House of Representatives on the effects of measures against tax avoidance, and publishing an annual list of noteworthy tax constructions with corresponding approaches with the Spring Memorandum. However, the government notes that data on the tax payments of individual taxpayers are subject to the tax secrecy obligation (Section 67 AWR), with privacy as a weighty interest. Further breach of this could damage the relationship of trust between the Tax Authority and citizens, and undermine the interest of the State. Policy options that affect this privacy are therefore not examined further.

Critical interpretation

Although the government recognizes the desire for greater transparency and calls on companies to comply with the Tax Governance Code, the protection principle around individual tax data remains leading. This safeguards parliament's view of structural tax practices, but keeps details about individual tax payments shielded.

Read the Chamber letter here