Monday

20th Jan 2020

MEPs' Luxleaks probe risks falling apart

  • MEPs will be going to Luxembourg to inquire about its tax rulings (Photo: R/DV/RS)

A special European Parliament committee to probe tax avoidance schemes is facing mounting obstacles to its work.

The problems, which include access to documents, administrative delays, and internal disagreements risk undermining the MEP’s investigation into how government-backed tax rulings allow multinationals, in some cases, to pay less than 1 percent tax.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 20 years of archives. 30-day free trial.

... or join as a group

One of the lead investigators, German liberal Michael Theurer, on Monday (11 May) voiced frustration on the committee’s attempts to shed light on the sweetheart tax deals.

“We need to make up some time, if we don’t do that, then the committee won’t be reaching its objectives because the mandate is only there for six months,” he said.

The special committee was set up in February in the wake of the “LuxLeaks” scandal, in which reporters disclosed the extent of tax-avoidance structures in Luxembourg.

The committee is mandated to look into tax ruling practices as far back as 1 January 1991.

It also wants to review the way the European Commission treats state aid in member states, the extent to which EU countries are transparent about their tax rulings, and then to draw up recommendations in a final report.

Request for documents sent six weeks late

But the entire exercise, which must be done by August, has been beset with delays.

The committee has requested documents from the commission, the EU Council (representing member states), and from national governments.

“If we don’t get the documents, then we really can’t do anything to draw up a report,” said Theurer.

A European Parliament contact said it took six weeks before the committee’s request for documents was officially sent. The Council, for its part, flat out refused.

“We didn’t get any answer from the Council,” said the German MEP.

A document list request, seen by this website, includes demands, from the commission, for an overview of corporate tax systems in EU member states.

But another request from the Brussels-executive, for an overview of the effective corporate tax rate of the 50 biggest companies in every EU member state, has been dropped.

Finance ministers turn their backs

With few exceptions, finance ministers from all member states have either refused or not responded to invitations from the committee to speak about their tax systems.

Only Estonia has so far confirmed.

A delegation of tax sleuths from the committee will be visiting six member states, starting with Belgium, on Tuesday (12 May).

Belgium’s finance minister has tentatively agreed to a meeting, but has yet to set any appointment despite being given a notice months in advance.

“We think it is really astonishing that we are unable to schedule an appointment with a minister who is in the same city,” noted the parliament contact.

Instead, the EP delegation on Tuesday will be meeting with university professors and the finance and budget committee of the Belgian parliament.

They also have a one-hour meeting with the head of the tax ruling service, Steven Vanden Berghe. The entire probe lasts around six hours.

After Belgium, they go to Luxembourg (18 May), then to Switzerland (22 May), Ireland (28 May), the Netherlands (29 May), and the UK (18 June).

“The deadline means that on 18 June we are going to the UK for that fact finding mission and on the 22nd, four days later, we are supposed to come up with some sort of draft report,” said Theurer.

Thousands apply for EU border guard posts

Around 7,500 applications were sent to Frontex to fill 700 new border guard posts. The guards will become official EU staff and wear a yet to be unveiled 'European Union' uniform.

Interview

Cloud of mistrust over Malta's new government

Malta's new government does not look likely to turn it into a normal, law-abiding EU state any time soon, the son of slain journalist Daphne Caruana Galizia has said.

News in Brief

  1. Malta: Another minister resigns over Caruana Galizia murder
  2. Belgian region threatens to block EU-Mercosur trade deal
  3. EU to cut pre-accession aid to Turkey by 75 percent
  4. Libya peace talks: 'new spirit' to find solution
  5. EU financial firms flock to UK
  6. 'No objection in principle' on Huawei cooperation, EU says
  7. French aircraft carrier goes to Middle East amid tensions
  8. EU suggests temporary ban on facial recognition

European politicians caught with Russian 'fake likes'

Politicians and political parties in Europe have had bots generate fake 'likes', views, and comments to boost their online popularity, in what has been described as outright voter manipulation.

Stakeholders' Highlights

  1. Nordic Council of Ministers40 years of experience have proven its point: Sustainable financing actually works
  2. Nordic Council of MinistersNordic and Baltic ministers paving the way for 5G in the region
  3. Nordic Council of MinistersEarmarked paternity leave – an effective way to change norms
  4. Nordic Council of MinistersNordic Climate Action Weeks in December
  5. UNESDAUNESDA welcomes Nicholas Hodac as new Director General
  6. Nordic Council of MinistersBrussels welcomes Nordic culture

Stakeholders' Highlights

  1. UNESDAUNESDA appoints Nicholas Hodac as Director General
  2. UNESDASoft drinks industry co-signs Circular Plastics Alliance Declaration
  3. FEANIEngineers Europe Advisory Group: Building the engineers of the future
  4. Nordic Council of MinistersNew programme studies infectious diseases and antibiotic resistance
  5. UNESDAUNESDA reduces added sugars 11.9% between 2015-2017
  6. International Partnership for Human RightsEU-Uzbekistan Human Rights Dialogue: EU to raise key fundamental rights issues

Join EUobserver

Support quality EU news

Join us