Monday

28th May 2018

MEPs demand stronger rules against tax evasion

  • MEPs are demanding full disclosure on people behind trusts and companies. (Photo: Burning Robot Factory)

MEPs are pushing to prevent people from hiding away billions of taxable revenue as part of broader EU reforms to tackle money laundering and tax evasion.

The latest measures, voted through on Tuesday (28 February) in committees dealing with the issue, would require the full disclosure of owners behind trusts and further pry open the beneficial owners of companies.

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.

Both points have met resistance from EU states who have argued that revealing people involved in trusts may violate privacy and data protection rules. They say that anyone who wants to access such information must demonstrate a "legitimate interest".

The latest vote on the EU's anti-money laundering directive is part of an ongoing saga following its initial adoption in 2015, later revised in 2016 by the EU commission.

The 2016 reforms have yet to reach a final agreement as the EU parliament now prepares to launch inter-institutional talks with member states and the EU commission next month.

MEPs are hoping governments will agree to set up public registries of beneficial owners of companies and trusts, accessible by anyone.

They may find some allies in Austria, who last December was reported by Bloomberg BNA to support "full public access".

Political pressure also appears to be on the side of the EU parliament, following the Panama Paper scandal of 11.5 million electronic files leaked from Panama-based law firm Mossack Fonseca.

Media published the findings last April, revealing offshore holdings of some 140 politicians and public officials around the world.

Tove Maria Ryding, tax justice coordinator at the Brussels-based European Network on Debt and Development, said in a statement that the MEP vote on public registers for both companies and trusts shows "they are serious about bringing an end to the kind of scandals that were exposed in the Panama Papers."

Dutch Green MEP Judith Sargentini who is helping steer the file through the EU parliament said the plan also includes imposing stiffer sanctions on those who violate the rules.

Terrorism and Malta

The proposed amendments on the bill also aim to tackle financing of terrorism and cracking down on criminals who use virtual currencies or pre-paid cards to shuffle money around undetected.

EU states want national Financial Intelligence Units to have the ability to crack open the identities of people who use digital money.

Some 70,000 virtual currency transactions are carried out daily, according to the European Central Bank.

Latvian centre-right MEP Krisjanis Karins, who is also co-leading the file with Sargentini, said restrictions on virtual currencies are needed to addresses terrorism threats.

"The behaviour of criminals has not changed. They use anonymity to launder their illicit proceeds or finance terrorism," he said in a statement.

The Council, representing member states, had already formalised its position on the directive in late December.

MEPs launched an inquiry committee in the wake of the Panama Papers scandal to investigate abuse throughout EU states.

Some of those named in the leaks included Malta's prime minister's chief-of-staff Keith Schembri.

MEPs in the inquiry visited the country last week to probe tax evasions schemes but were denied a meeting with Schembri.

With Malta at the helm of the EU's rotating six month presidency, some have cast doubt on its commitment towards a strong EU anti-money laundering directive.

Far-left Portuguese MEP Miguel Viegas, who was among those in Malta, accused the country of setting up structures that siphon away billions of tax revenue owed by multinationals to other countries.

"In this regard, Malta is not different from other EU countries such as Luxembourg or the Netherlands," he said.

EU states set to oppose tax transparency bid

A compromise text by the Slovak EU presidency is proposing to water down the commission's plans to allow public access to the names of those who own offshore accounts.

EU tightens money laundering rules

Banks will now have 48 hours to freeze assets in accounts spread across Europe flagged as belonging to people aiming to use it for terrorist operations.

Malta rejects tax haven accusations

Finance minister Scicluna said that a report published by Green MEPs was "unfair" and that Malta had "nothing to hide".

EU states obstructing tax transparency

EU states are blocking efforts to make their tax regimes more transparent, amid new revelations how politicians and world leaders avoid paying tax.

Analysis

EU has no 'magic bullet' against US Iran sanctions

EU leaders in Sofia will discuss how they can protect the bloc's economic interests against US threats to sanction companies doing business in Iran. But their options are limited.

Opinion

EU budget must not fortify Europe at expense of peace

Given the European Commission new budget's heavy focus on migration, border management and security, many are asking whether the proposal will fortify Europe at the expense of its peace commitments.

Stakeholders' Highlights

  1. Counter BalanceEuropean Ombudsman requests more lending transparency from European Investment Bank
  2. Nordic Council of MinistersOECD Report: Gender Equality Boosts GDP Growth in Nordic Region
  3. Centre Maurits Coppieters“Peace and reconciliation is a process that takes decades” Dr. Anthony Soares on #Brexit and Northern Ireland
  4. Mission of China to the EUMEPs Positive on China’s New Measures of Opening Up
  5. Macedonian Human Rights MovementOld White Men are Destroying Macedonia by Romanticizing Greece
  6. Counter BalanceControversial EIB-Backed Project Under Fire at European Parliament
  7. Nordic Council of MinistersIncome Inequality Increasing in Nordic Countries
  8. European Jewish CongressEU Leaders to Cease Contact with Mahmoud Abbas Until He Apologizes for Antisemitic Comments
  9. International Partnership for Human RightsAnnual Report celebrates organization’s tenth anniversary
  10. Nordic Council of MinistersNordic Cooperation Needed on Green Exports and Funding
  11. Mission of China to the EUPremier Li Confirms China Will Continue to Open Up
  12. European Jewish CongressCalls on Brussels University to Revoke Decision to Honour Ken Loach

Stakeholders' Highlights

  1. Sustainable Energy Week 2018"Lead the Clean Energy Transition"- Register and Join Us in Brussels from 5 to 7 May
  2. EU Green Week 2018Green Cities for a Greener Future. Join the Debate in Brussels from 22 to 24 May
  3. Nordic Council of Ministers12 Recommendations for Nordic Leadership on Climate and Environment
  4. Macedonian Human Rights MovementOxford Professor Calls for an End to the Anti-Macedonian Name Negotiations
  5. ACCAPeople Who Speak-Up Should Feel Safe to Do So
  6. Mission of China to the EUProgress on China-EU Cooperation
  7. Nordic Council of MinistersWorld's Energy Ministers to Meet in Oresund in May to Discuss Green Energy
  8. ILGA EuropeParabéns! Portugal Votes to Respect the Rights of Trans and Intersex People
  9. Mission of China to the EUJobs, Energy, Steel: Government Work Report Sets China's Targets
  10. European Jewish CongressKantor Center Annual Report on Antisemitism Worldwide - The Year the Mask Came Off
  11. UNICEFCalls for the Protection of Children in the Gaza Strip
  12. Mission of China to the EUForeign Minister Wang Yi Highlights Importance of China-EU Relations