A lobby group has called for the Big Four accountancy firms to be “kicked out” of the policy-forming process in Europe.
Corporate Europe Observatory (CEO), a Brussels-based group whose aim is to “expose and challenge the privileged access and influence” that companies have upon EU policymaking, has produced a report which illustrates major conflicts between PwC, EY, Deloitte and KPMG in their role in mitigating corporates’ tax, versus influencing policy.
The firms receive “tens of millions” from the European Commission in public procurement contracts, outlining their work on studies and analyses into tax and customs areas.
“This means the enablers of major tax avoidance are paid for studies that inform the making of tax avoidance-related laws”, CEO states.
It claimed that Deloitte was hired to advise on transfer pricing, despite advising clients on the measure, and lobbying against stricter measures to tackle it.
The Big Four also have influential roles in a number of lobby groups, including the European Business Initiative on Taxation; the European Contact Group and Accountancy Europe.
“It is time to kick the Big Four and other players in the tax avoidance industry out of EU anti-tax-avoidance policy,” argues CEO. “This must start with recognition of the conflict of interest in allowing tax intermediaries to advise on tackling tax avoidance.”
An EY spokesman said that “robust, transparent and consistent tax systems are fundamental to the effective functioning of the global economy”.
“We work with the OECD, governments and businesses to improve certainty in, and compliance with, tax systems globally, and we support transparency in dealings with tax administrations to help build trust in the system.”
The other firms did not comment.