EU leaders see progress on lifting bank secrecy

16:42 23/5/2013 - Πηγή: BankWars

EU leaders in Brussels for a special summit on tax evasion and fraud hailed new political “momentum” on the issue, but few concrete measures were agreed to recoup the estimated €1 trillion yearly in lost revenues.

The upshot of the four-hour meeting was several deadlines – the most prominent being a call for the the adoption “before the end

of the year” of the savings directive.

This vexed piece of legislation – on sharing bank account information allowing tax evasion to be more easily spotted – has been stuck in the EU pipelines for eight years.

German Chancellor Angela Merkel said the agreement was a “giant step.” She added: “There will finally be an exchange of necessary tax information in the European Union.”

Chancellor Werner Faymann of Austria, one of the main opponents of the legislation, called it a “bad day for tax cheats.”

Luxembourg’s Jean-Claude Juncker, the second of the two hold-out countries, was more circumspect but said his duchy will go along with the agreement “so long as the European Union goes ahead with its negotiation with Switzerland and other countries.”

European Commission chief Jose Manuel Barroso gave a mixed message.

He said there is “new momentum among our member states,” but also noted that wording on automatic exchange of information could have been “more precise.”

EU leaders also agreed that the new anti-money laundering law should be adopted by the end of the year, while the EU commission is to present a revised version of a law governing how parent companies and their subsidiaries should be taxed.

This revision comes amid revelations by the US senate that technology giant Apple paid just 2 percent tax on $74 billion in overseas income, largely by using a hole in Ireland’s tax rules.

The manouvering is not illegal but contrasts starkly with the slashing in public expenditure undertaken by governments across the EU.

“We will work towards ensuring companies have to pay more where they are based,” said Merkel.

Referring to legal loopholes, French President Francois Hollande said “we must co-ordinate at a European level, harmonise our rules and come up with strategies to stop this.”

“This is a turning point in breaking down corporate secrecy… This is a big step forward in terms of getting to grips with the issue,” said British leader David Cameron, who himself has come under pressure to turn up the heat on internet giant Google, accused of not paying enough tax in the UK.

However, MEPs from the Green and Socialists groups criticised EU leaders for not taking up the European Parliament’s proposal to define and then blacklist tax havens.

Belgian Green Philippe Lamberts spoke of “faltering progress” on tackling tax evasion.

Meanwhile, others wonder about London’s commitment to the tack evasion fight.

According to UK-based charity Oxfam, the UK and its dependencies account for over half of the estimated €9.5 trillion hidden in EU-related tax havens.

“I don’t see a lot of political will in there at the moment,” Richard Murphy of UK-based NGO Tax Justice Network told this website.

Cameron is only making “very careful demands” of these tax havens- which range from Jersey, to Gibraltar and the Cayman islands – he added referring to letters sent on Monday asking them for greater transparency.

Πηγή: EUObserver