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Plans to force the largest companies to disclose more about their tax affairs will be unveiled by the European Union on Tuesday.

The rules will affect multinational firms with more than €750m in sales.

They will have to detail how much tax they pay in which EU countries as well as any activities carried out in specific tax havens.

The plans come amid heightened scrutiny of the use of tax havens following the Panama Papers revelations.

Transparency

Lord Hill, the EU's financial services commissioner, said: "This is a carefully thought through but ambitious proposal for more transparency on tax.

"While our proposal on [country-by-country reporting] is not of course focused principally on the response to the Panama Papers, there is an important connection between our continuing work on tax transparency and tax havens that we are building into the proposal."

Country-by-country reporting rules already apply to banks, mining and forestry companies, according to an EU spokesperson.