EU agrees new rules to close tax loopholes for multinationals

EU finance ministers agreed Tuesday to close loopholes that multinational firms exploit to pay low or no taxes by shopping for better deals outside the 28-nation bloc.

They said the new rules aim to prevent firms from "exploiting disparities" in tax rates, particularly those in countries outside the bloc given that the EU issued a tax-avoidance directive for its member states last year.

The agreement to tackle so-called "hybrid mismatches" aims to end the erosion of taxable bases of corporate taxpayers in the European Union.

"Today is yet another success story in our campaign for fairer taxation" said Pierre Moscovici, the EU's top economic affairs official.

"Step by step, we are eliminating the channels used by certain companies to escape taxation," he added in a statement.

The new rules are due to take effect in 2020, once member states enact them into law. In rare cases, they will apply from 2022.

The latest of many initiative comes amid growing public outrage about tax avoidance by multinational corporations.