The European rules require large companies — including asset managers — to publish how much tax they pay in each country they operate in, to help tackle tax avoidance and evasion by multinationals.
The EU’s tax plans, which are expected to come into force in 2018, are likely to affect only large fund ranges and private equity vehicles, as the rules will only apply to companies with annual global revenues of at least €750m. Those affected by the rules will be required to publish a breakdown of their tax affairs on their website.
Mick McAteer, co-founder of The Financial Inclusion Centre, a think-tank, and former board member of the UK financial regulator, said more reporting of asset managers’ tax affairs would improve confidence in the industry among investors. “Greater transparency and accountability is a prerequisite for restoring confidence and trust in the asset management sector. If there is a sector that desperately needs to restore trust and confidence, it is asset management.”
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