The European Parliament, this morning debated the most recent revelations of the Paradise Papers and possible consequences. The recent scandal shows that the recommendations of the European Parliament’s Committee of Inquiry into the Panama Papers must be adopted and implemented as a matter of urgency. This also includes the establishment of a permanent committee of inquiry similar to the one in the US Congress to investigate current and future tax and money laundering issues.
MEP Sven Giegold, financial and economic policy spokesperson of the Greens/EFA group commented:
“After the outrage at the tax dumping of celebrities, politicians and large companies, we must now take effective action to repair Europe’s patchy tax system. The EU Commission has put forward numerous proposals in reaction to the pressure from the European Parliament. Practically all of them are currently being blocked by the Council of Member States. This blockade against tax justice must stop. However, continuous appeals to the Member States will not help. Therefore, the European Parliament must be prepared to use all its instruments available to bring the Council to imposing European tax cooperation. The inability of Europe to act effectively against tax avoidance and money laundering jeopardises the support of European integration.
The Paradise Papers demonstrate Britain’s central role in global tax dumping. The Brexit negotiations are an opportunity to drain the British tax havens. The City of London and the associated tax havens should only retain their access to the EU internal market if they end tax avoidance operations.”
CURRENTLY BLOCKED TAX PROPOSALS
- Tax transparency for large companies (country-by-country reporting): German and Austrian federal government blocking
- Law firms, tax advisors: reporting obligation for cross-border tax savings schemes. German Federal Government demands dilution
- Black-list of tax havens: tax havens criteria have been watered down. Now these too lax criteria are being applied inconsistently in a non-transparent Council working group
- Reform of the Anti-Money Laundering Directive: German Federal Government opposes full transparency of company owners, opposes a national real estate register and wants laxer due diligence in the identification of national politicians
- Common tax base (CCCTB)
- Package of measures against VAT fraud in the EU
- Financial transaction tax in enhanced cooperation
- Taxation of interest and royalty payments from the EU in tax havens (discussion stuck in Council Code of Conduct Group on Business Taxation)
The Committee of Inquiry into money laundering, tax avoidance and tax evasion (PANA) voted on its draft report on 18 October 2017. The vote in plenary is expected in December. A summary of the recommendations can be found here: https://www.greens-efa.eu/en/article/news/we-need-better-rules-to-prevent-future-paradise-papers/