Sunday

22nd Sep 2019

New 'momentum' for EU tax haven sanctions

  • Tuesday's meeting saw broad agreement on the blacklist, Toniste said (Photo: consilium.europa.eu)

The EU is preparing to name and shame global tax havens in December, amid new "political momentum" that could lead to sanctions.

EU finance ministers discussed the tax haven blacklist in Brussels on Tuesday (7 November) in the wake of fresh revelations, the so-called 'Paradise Papers', which showed how US tech giant Apple, for one, used the British crown dependency of Jersey to avoid paying billions in taxes on its European profits.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

  • Altmaier (r) said new eurogroup chief should be chosen on "merit" (Photo: consilium.europa.eu)

Going into Tuesday's meeting, French finance chief Bruno Le Maire said: "We need to take concrete steps to improve the situation".

He said EU-designated tax havens should be banned from getting World Bank or International Monetary Fund aid.

"We need sanctions and we have to implement the sanctions. We cannot accept tax evasion any longer", the minister noted.

He added that the EU needed more "transparency" on the middlemen who created aggressive tax schemes and that EU members needed to "share information" on their tax regimes.

His Belgian counterpart, Johan Van Overtveldt, also said it was "necessary to sanction [blacklisted] countries".

Valdis Dombrovskis, the commissioner for the euro, backed the idea.

"We hope the Paradise leaks will help us see a new political momentum," he said.

"Having an agreement on the blacklist is possible by the end of the year. We think it's also possible to have an agreement on counter-measures against jurisdictions that end up on the blacklist," he said.

Toomas Toniste, the Estonian finance chief, who chaired Tuesday's event as part of Estonia's EU presidency, said adoption of the register was "very important for most member states."

But those EU countries which host offshore banking centres, such as Austria, Cyprus, Ireland, Luxembourg, Malta, the Netherlands, and the UK, were either silent on Tuesday or voiced scepticism on the EU plan.

"A blacklist is always a difficult exercise", Luxembourg finance chief Pierre Gramegna said.

Austria's Hans Joerg Schelling noted that "if one tax oasis closes, another one opens."

The EU already sent letters of enquiry on tax measures to 92 jurisdictions in February in preparation for the blacklist project.

Draft lists

The process has put 53 entities in the crosshairs, including 12 British dependencies such as Bermuda, the Isle of Man, and the Cayman Islands, according to the Financial Times, a British newspaper.

An informal list published by the Commission two years ago and updated last December also gave an idea of which countries and territories might end up on the common EU list in December.

It included multiple tiny locations in the Caribbean and in Oceania, such as the British Virgin Islands, the Bahamas, Panama, Fiji, Nauru, and Palau.

It also covered a handful of places in Asia and the Middle East, such as Malaysia, Hong Kong, Singapore, Jordan, and the UAE.

And it included several locations closer to home - Andorra, Bosnia, Macedonia, Moldova, Monaco, Montenegro, San Marino, Serbia, and Switzerland.

But Global Witness, a British NGO, said on Tuesday that EU states were themselves helping financial wrongdoing by protecting the secrecy of shell firms and trusts on their territories.

"Talk of tax haven blacklists by Europe's finance ministers may grab the headlines, but the EU hasn't got its own house in order," Rachel Owens, from the NGO's Brussels office, said.

"Before the EU points the finger at others, it needs to clean up its own act," she said, calling for EU states to make public the real owners of such legal structures in talks, due next week, on new anti-money laundering laws.

New face

Tuesday's meeting marked the EU debut of German acting finance minister Peter Altmaier, who recently took over from Wolfgang Schaeuble amid reshuffles in Berlin.

He said Frankfurt "would be a great choice" to host the European Banking Authority, an EU agency, when it moves out of London after Brexit.

He said Brexit was "regrettable" and that "when you look at the debate in London, you realise how difficult it is to separate ties build up over 40 years in two years".

He also said the next chief of the eurozone ministers' forum, the eurogroup, should be chosen on "merit" instead of a political or geographical basis.

An informal shortlist of people who might take over the post from outgoing Dutch finance minister Jeroen Dijsselbloem includes Slovakia's Peter Kazimir, Latvia's Dana Reizniece-Ozola, Luxembourg's Gramegna, and Portugal's Mario Centeno.

Spanish finance minister Luis de Guindos said on Tuesday he would "naturally support" the Portuguese politician because they shared the same vision for Europe.

"I am not a candidate," Centeno said, however, downplaying Spain's remarks as a form of "Iberian affinity."

EU commission wants 'credible' tax haven blacklist

The EU's finance commissioner Pierre Moscovici told reporters that he wants a credible EU blacklist of tax havens following the latest media tax avoidance revelations of the wealthy elite in the Paradise Papers.

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.

EU takes aim at UK tax perks

Commission to probe whether UK tax perks for multinationals worth billions of euros amounted to illegal state aid.

MEPs ponder how to fight tax havens

After the Paradise Papers brought new revelations about tax dodging across the globe, including in the EU, the European Parliament wonders how to step up the fight.

Hungary tops EU anti-fraud investigation list

In its annual report, the EU's anti-fraud agency said it concluded nine investigations into Hungary and found irregularities in seven cases. In total, the agency recommended the recovery of €371m EU-wide.

News in Brief

  1. Ireland: right Brexit deal is 'not yet close'
  2. UK secrecy on Brexit holds back wider EU talks
  3. Feminist mass protest in Spain after 19 murders this summer
  4. Global climate strike starts ahead of UN summit
  5. UK Brexit minister to meet Barnier on Friday
  6. Russia-Ukraine gas deal talks show 'progress'
  7. Nobel economist: Ireland 'not good EU citizen' on taxes
  8. Germany takes carbon border tax on board

Opinion

Why von der Leyen must put rights at core of business

Ursula von der Leyen's in-tray must include those European executives on trial for systematic workplace harassment, the break-up of European slavery rings, and allegations of European companies' abuse in palm oil, including child labour, land grabs, and deforestation.

Stakeholders' Highlights

  1. Nordic Council of MinistersNew programme studies infectious diseases and antibiotic resistance
  2. UNESDAUNESDA reduces added sugars 11.9% between 2015-2017
  3. International Partnership for Human RightsEU-Uzbekistan Human Rights Dialogue: EU to raise key fundamental rights issues
  4. Nordic Council of MinistersNo evidence that social media are harmful to young people
  5. Nordic Council of MinistersCanada to host the joint Nordic cultural initiative 2021
  6. Vote for the EU Sutainable Energy AwardsCast your vote for your favourite EUSEW Award finalist. You choose the winner of 2019 Citizen’s Award.
  7. Nordic Council of MinistersEducation gets refugees into work
  8. Counter BalanceSign the petition to help reform the EU’s Bank
  9. UNICEFChild rights organisations encourage candidates for EU elections to become Child Rights Champions
  10. UNESDAUNESDA Outlines 2019-2024 Aspirations: Sustainability, Responsibility, Competitiveness
  11. Counter BalanceRecord citizens’ input to EU bank’s consultation calls on EIB to abandon fossil fuels
  12. International Partnership for Human RightsAnnual EU-Turkmenistan Human Rights Dialogue takes place in Ashgabat

Latest News

  1. Europe goes to New York This WEEK
  2. Nine EU 'commissioners' asked to clarify declarations
  3. Dismiss Italy's Salvini at your peril
  4. Malta PM accused of 'blackmail' over slain reporter
  5. Diplomats back Romania's Kovesi for EU top prosecutor
  6. Brexit raises questions for EU defence integration
  7. Low-carbon cities can unlock €21tn by 2050, report finds
  8. France, Italy want 'automatic' distribution of migrants

Stakeholders' Highlights

  1. Nordic Council of MinistersNew campaign: spot, capture and share Traces of North
  2. Nordic Council of MinistersLeading Nordic candidates go head-to-head in EU election debate
  3. Nordic Council of MinistersNew Secretary General: Nordic co-operation must benefit everybody
  4. Platform for Peace and JusticeMEP Kati Piri: “Our red line on Turkey has been crossed”
  5. UNICEF2018 deadliest year yet for children in Syria as war enters 9th year
  6. Nordic Council of MinistersNordic commitment to driving global gender equality
  7. International Partnership for Human RightsMeet your defender: Rasul Jafarov leading human rights defender from Azerbaijan
  8. UNICEFUNICEF Hosts MEPs in Jordan Ahead of Brussels Conference on the Future of Syria
  9. Nordic Council of MinistersNordic talks on parental leave at the UN
  10. International Partnership for Human RightsTrial of Chechen prisoner of conscience and human rights activist Oyub Titiev continues.
  11. Nordic Council of MinistersNordic food policy inspires India to be a sustainable superpower
  12. Nordic Council of MinistersMilestone for Nordic-Baltic e-ID

Join EUobserver

Support quality EU news

Join us