Wednesday

24th May 2017

Top five EU states push for tax transparency

  • Austria and Luxembourg have been opposed to loosening rules on bank secrecy (Photo: Images_of_Money)

France, Germany, Italy, Spain and the UK have agreed to more automatic exchanges of banking data to fight tax evasion, increasing pressure on Austria and Luxembourg to give up their veto on the equivalent EU bill.

In a joint letter to the EU commission sent on Tuesday (9 April), the finance ministers of the five largest EU countries say they have agreed on a "pilot" project of "automatic information exchange" aimed at fighting tax evasion.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

The initiative is open to other member states and is based on a recently adopted law in the US - the Foreign Account Tax Compliance Act - that requires US citizens to declare their bank accounts held abroad and foreign banks to notify US tax authorities about their American clients.

A similar EU-wide law has so far been held up by Austria and Luxembourg, both keen on preserving bank secrecy for domestic and foreign clients.

The five finance ministers "call on all EU member states to agree without delay" on the bill, so that "Europe can take a lead in promoting a global system of automatic information exchange, removing the hiding places for those who would seek to evade paying their taxes."

The collapse of the Cyprus banking system - which like Luxembourg's was much larger than the country's GDP - and a series of revelations about the offshore banking model have increased pressure on Austria and Luxembourg to change their position.

Luxembourg has already signalled "openness" to discuss bank secrecy. And on Tuesday, Austrian Chancellor Werner Faymann told the Kleine Zeitung his country was "ready for talks on a more intensive exchange of information on international investors."

But added that bank secrecy will remain in place for domestic customers and said it would be "absurd" for an Austrian grandmother to have to show her savings accounts to the Austrian finance minister.

The comments came after a spokesman for EU tax commissioner Algirdas Semeta said it was "unacceptable" that Austria was refusing to reform its banking secrecy laws.

Semeta also welcomed the initiative of EU's five largest countries and said in a statement this it may "speed up" the EU efforts. "

"Transparency is the key when it comes to fighting tax evasion and the global environment today leaves little room for those who resist it," Semeta said.

Luxembourg may loosen bank secrecy

Luxembourg may consider opening up its massive banking sector to greater scrutiny following concerns people are stashing away wealth from foreign tax inspectors.

French leader promises anti-tax-cheat crusade

French leader Hollande has promised to "eradicate" tax havens in the EU and in the wider world, after his approval rating fell to 26 percent following a tax scandal.

Austria attacks UK, as EU finance talks get ugly

Austria has accused the UK of being a haven for money launderers ahead of an EU meeting in Dublin, with Cyprus, Ireland, Portugal and Slovenia's (potential) bailout needs also on the agenda.

News in Brief

  1. Pressure grows on climate impact of EU timber harvesting
  2. US goes after Fiat Chrysler over emissions cheat
  3. Munich police break up Europe-wide burglar clan
  4. Report: VW threatened with €19.7 billion French fine
  5. Turkey begins mass trial of suspected coup leaders
  6. Merkel's CDU consolidates lead in polls
  7. France to host Russian president
  8. Switzerland votes against nuclear power

Stakeholders' Highlights

  1. UNICEFChild Alert on Myanmar: Fruits of Rapid Development yet to Reach Remote Regions
  2. Nordic Council of MinistersBecome an Explorer - 'Traces of Nordic' Seeking Storytellers Around the World
  3. Malta EU 2017Closer Cooperation and Reinforced Solidarity to Ensure Security of Gas Supply
  4. European Healthy Lifestyle AllianceHigh-Intensity Interval Training Is Therapeutic Option for Type 2 Diabetes
  5. Dialogue Platform"The West Must Help Turkey Return to a Democratic Path" a Call by Fethullah Gulen
  6. ILGA-EuropeRainbow Europe 2017 Is Live - Which Countries Are Leading on LGBTI Equality?
  7. Centre Maurits CoppietersWhen You Invest in a Refugee Woman You Help the Whole Community
  8. Eurogroup for AnimalsECJ Ruling: Member States Given No Say on Wildlife Protection In Trade
  9. European Heart NetworkCall for Urgent Adoption of EU-Wide Nutrient Profiles for Nutrition & Health Claims
  10. Counter BalanceInvestment Plan for Europe More Climate Friendly but European Parliament Shows Little Ambition
  11. Mission of China to the EUPresident Xi: China's Belt and Road Initiative Benefits People Around the World
  12. Malta EU 2017EU Strengthens Control of the Acquisition and Possession of Firearms