A delegation of tax avoidance investigators from the European Parliament was in Luxembourg to probe the authorities and government officials on the role the country has played in facilitating tax dodging. The delegation of MEPs from the Panama Papers Committee of Inquiry are investigating revelations contained in the offshore leaks, which include the Panama Papers and the Bahamas Leaks.
Meeting with the Finance and Justice Ministers, Members of the Parliament, a journalist, the banking supervisor, the head of the Luxembourgish Bar and intermediaries like HSBC, KPMG or PwC, the committee investigated how EU tax and anti-money laundering obligations were enforced in the Grand Duchy.
Greens MEPs Molly Scott Cato and Sven Giegold participated to this mission and while recognising that tax reforms have been recently adopted by the Government to ensure serious tax crimes can be prosecuted for money laundering, questions remain as to practices of the past. Based on the ICIJ Offshore Leaks database, the Greens publish today the detailed list of the 400+ intermediaries operating in Luxembourg and mentioned in the Panama Papers.
MEP Sven Giegold, financial and economic policy spokesperson of the Greens/EFA group commented:
“Today’s revelations in the Luxembourgish press that one of the representatives invited by our committee received an email from the government recommending him not to comply with the invitation of the committee is very disturbing. We deeply regret that several invitees declined to appear but the Government needs to shed light on whether they interfered in this process.”
“The government representatives have made positive and far reaching commitments with regard to cooperating with public investigations in partner countries. While recent legislation has been adopted to ensure that criminal cooperation on serious tax evasion and money laundering, I regret that simple tax evasion (roughly below €200.000) is not considered a crime in Luxembourg. This causes difficulties for the good cooperation with police or law enforcement authorities in Germany or elsewhere which are after tax evaders. Similarly, there are over 400 intermediaries in Luxembourg mentioned in the Panama Papers but it appears that an investigation has only touched on 73 of them to ensure they have fully complied with their anti-money laundering and tax obligations. In particular lawyers are not effectively supervised when it comes to money laundering”.
UK Green MEP Molly Scott Cato, member of the delegation visiting Luxembourg:
“Our visit to Luxembourg gave evidence of the capture of the state and the national culture by the finance industry and by tax intermediaries. We do not accept the argument that because legal and financial support for tax avoidance takes place in many countries it can be justified within the EU. And we will fight attempts to use the increasingly anti-social and regressive approach to tax competition shown by the UK and US to justify reducing rates of corporate or personal tax within the EU.”
Note to editors
- Intermediaries in Luxembourg: based on information in the ICIJ Offshore Leaks database, the Greens have detailed the list of intermediaries operating in Luxembourg and the details of how many offshore structures are linked to them: https://sven-giegold.de/2017/gruene-veroeffentlichen-hitparade-luxemburger-vermittler-in-den-panamapapers/
- In January 2016, the Greens published a report on the role of the intermediaries in the Offshore Leaks, Panama Papers and Bahamas Leaks. The report highlights that Luxembourg is the second European country behind the UK in terms of number of intermediaries operating there. Several Luxembourgish intermediaries are also named in the report, which is available at: http://www.greens-efa.eu/en/article/news/who-are-the-middlemen-helping-to-dodge-tax-or-launder-dirty-money/