The chair of the EU’s parliamentary tax subcommittee is calling for a centralized asset registry—a repository of all forms of wealth held by EU citizens, corporations, partnerships, and other business entities. This proposal has ignited significant debate, primarily due to concerns over its efficacy and privacy implications. While its aim is to track down terrorists, money launderers, and tax evaders, critics argue that those engaged in illicit activities are unlikely to willingly report their assets, thereby burdening honest citizens with onerous reporting requirements.
The registry, accessible by numerous government employees described as “competent authorities,” raises alarms about data security. As noted in previous cases involving sensitive data leaks at the IRS, such vast data pools could become a potential goldmine for litigants and other unscrupulous actors.
Tax Subcommittee Chair Pasquale Tridico advocates this initiative to support OECD Pillar Two, which aims for a 15% minimum tax on the profits of multinational corporations. Tridico believes the registry will help uncover hidden assets and earnings globally. However, experts suggest focusing on expanding audit teams rather than creating more data.
The proposal’s broader context includes the global tax landscape influenced by the OECD’s Pillar Two and the trend of governments providing substantial subsidies to select multinational corporations. From the US’s Inflation Reduction Act to the EU’s Airbus subsidies and China’s investments in renewable energy, these initiatives exemplify how large economies can sway industrial competition, overshadowing smaller countries that rely on simpler tax systems to attract business.
As it stands, the centralized asset registry appears poised to impose significant costs on compliance without corresponding benefits in tax enforcement. The argument is that honest entities may bear the heaviest burdens, while illicit actors remain elusive.