Thursday

9th Jul 2020

Redacted tax fraud report poses questions on Juncker

  • Juncker last week said he wasn't aware of any missing page (Photo: ec.europa.eu)

A missing page from an 18-year old report is casting a shadow over the European Commission president’s alleged role in corporate tax avoidance schemes.

Sweetheart tax deals in Luxembourg enabled some 340 multinationals to legally divert hundreds of billions of euros away from national coffers elsewhere.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

Designed by big accountancy firms like PricewaterhouseCoopers (PwC), at least 548 were set up between 2002 and 2010, when Jean-Claude Junker presided over the Grand Duchy as its prime minister and finance minister.

But Juncker has consistently denied any role in the matter despite making claims in 2004 that he had “personally lobbied for these companies to choose Luxembourg as a European base”.

He had also in 2004 taken partial credit for attracting big firms like Amazon, AOL, and Microsoft to set up offices in his home state. Amazon has since become part of a broader probe by EU regulators into the Duchy’s low tax arrangements.

Last week, he told skeptical MEPs in the special committee on tax that they were exaggerating his “political talent in that respect.”

But a report on fiscal fraud by Luxembourg’s former economic minister and Juncker’s political rival Jeannot Krecke is rousing fresh suspicion.

The 239-page report recommended to step up audits on tax rulings. It was released to the public a few months after Juncker became PM in December 1996.

Krecke at the time had a one page on tax rulings - deemed too sensitive for public disclosure - removed before it went public.

“My decision [to redact the page] was based on the fact that I did not find it appropriate to launch an international discussion on tax rulings during our presidency”, he said in an email, seen by this website, to Fabio de Masi, a German MEP from the United Left.

Only three copies of the full report were handed out. One of those went to Juncker.

De Masi asked Juncker at a special committee hearing on 17 September to produce the missing page to help them in their broader inquiry.

But Juncker told the MEP he didn’t know anything about the report.

“And, actually, I don’t have that documentation in my cellar and I’m also not going to go in my cellar with you to go and look for it”, he said.

Krecke says he handed Juncker the full report in 1997 and then once again after the committee hearing.

“After the hearing at the European Parliament, I gave once again a version of the personal report to Mr. Juncker, as obviously he did not have any more this version”, he said.

Krecke also told a journalist from Luxembourg in an interview that he had handed Juncker a complete version of the report just before the same hearing on 17 September.

Asked to comment, Juncker’s spokesperson Margaritis Schinas on Monday (28 September) said it was up to Krecke to produce the missing page.

“If you are asking me if Mr Juncker has anything to say about the missing part, well it is up to the author to answer this question”, said Schinas.

Krecke, for his part, has declined.

Juncker denies role in tax scams

EU Commission chief Juncker says he had nothing to do with Luxembourg's sweetheart tax deals in his time as PM of the microstate.

Rule-of-law row complicates budget talks

Disagreements are running deep between EU leaders over the overall size of the budget and recovery package, the criteria and mode of distribution and the conditions, with rule of law "another battle ground opening up".

News in Brief

  1. France and Germany warn Israel on annexation 'consequences'
  2. Shipping firms to face EU carbon regime
  3. EU to mediate between Greece, Cyprus, and Turkey
  4. EU to unveil arms-trafficking and drug proposals
  5. EU to discuss people-smuggling with African states
  6. 'Torture chamber' found in Dutch sea containers
  7. Commissioner backs under-attack Hungarian news site
  8. New French government tilts to right

Opinion

On toppling statues

The internationally-acclaimed author of King Leopold's Ghost, Adam Hochschild, writes on Belgium's problems with statues, in the wake of the Black Lives Matter movement.

Stakeholders' Highlights

  1. UNESDANext generation Europe should be green and circular
  2. Nordic Council of MinistersNEW REPORT: Eight in ten people are concerned about climate change
  3. UNESDAHow reducing sugar and calories in soft drinks makes the healthier choice the easy choice
  4. Nordic Council of MinistersGreen energy to power Nordic start after Covid-19
  5. European Sustainable Energy WeekThis year’s EU Sustainable Energy Week (EUSEW) will be held digitally!
  6. Nordic Council of MinistersNordic states are fighting to protect gender equality during corona crisis

Latest News

  1. Merkel urges EU unity to hold off economic fallout and populism
  2. The opportunistic peace
  3. EU mulls new system to check illegal pushbacks of migrants
  4. EU forecasts deeper recession, amid recovery funds row
  5. Revealed: fossil-fuel lobbying behind EU hydrogen strategy
  6. Commission chief under fire for Croatia campaign video
  7. Parliament vaping booths 'too confidential' to discuss
  8. Belarus: Inside Lukashenko’s crackdown on independent voices

Join EUobserver

Support quality EU news

Join us