23rd February 2018
As the clampdown on global tax evasion intensifies, the EU parliament has committed to launching a special committee to tackle international financial fraud. Currently known as Taxe 3, this group will be responsible for a 12-month enquiry into existing tax issues across the bloc.
Made up of 45 MEPs, the Taxe 3 committee will need to be confirmed by a vote in March, however as the initial agreement has been negotiated across political groups already, this is unlikely to change any decisions.
Taxe 3 will be building on the work already carried out by similar inquiries following the Panama Papers revelations. The main focus areas for the investigation will be evasion and avoidance in the digital economy as well as VAT fraud. The committee will also be closely monitoring member states that have yet to remove tax practices that enable evasion or avoidance.
Global tax evasion inquiry
News of this latest inquiry comes as a result of the Paradise Papers leak at the end of 2017 and is just one of many steps we can expect to see in the near future as global authorities seek to bring fraudulent behaviour and the use of tax havens under control.
For recruiters and the contractors they place overseas, the world of international tax compliance is now not only more complex than it has ever been, but it is also more heavily monitored. As a result, anyone failing to abide by the correct legislation in both their location of work and their country of origin will face penalties. This will include those involved in accidental evasive behaviour as well as deliberate fraud.
Recruiters at risk
Agencies and their directors are now likely to face criminal charges, in the UK, under the Criminal Finances Act, if their contractors are not paying the right amount of tax, wherever in the world they might be working.
In this environment, it’s vital that recruitment firms partner with an expert. At 6CATS International, we offer contract management solutions in more than seventy countries across Europe, the Middle East and Africa, as well as further afield.
Contact our team today to find out how your firm could benefit from a partnership with 6CATS International.