The leftist GUE/NGL group has started gathering signatures from MEPs for a motion of censure against the commission led by Jean-Claude Juncker over his involvement in widespread tax evasion while he was Finance Minister of Luxembourg, revealed by the so-called Luxleaks.
In a communiqué published yesterday (11 November), the European Parliament’s group European United Left – Nordic Green Left, which consist of 52 members from 14 countries, says it is looking for as broad support as possible from other political groups to help reach the total of 76 MEPs needed to submit the motion to vote. However, GUE/NGL MEPs will not be accepting signatures from extreme right-wing MEPs that wish to sign.
GUE/NGL President Gabi Zimmer said that the “Luxleaks” scandal was “just one very clear example of EU governments’ acceptance of ‘legal’ tax evasion and fraud”.
The scandal erupted on 5 November, when the International Consortium of Investigative Journalists (ICIJ) published articles based on a review of nearly 28,000 pages of confidential documents, which reveal that more than 300 international companies appear to have channeled hundreds of billions of dollars through Luxembourg and saved billions of dollars in taxes.
Malin Björk, GUE/NGL Vice-President, called the scale of tax evasion in Luxembourg under Juncker’s leadership “shocking”.
“Now is not the time to wait and see, but a time for action. To not act now would be the same as giving Juncker and all the companies using Luxembourg as a tax haven a free pass to continue these aggressive tax evasion policies,” she stated.
Juncker has resisted calls from MEPs to speak to Parliament over the issue. Margaritas Schinas, his spokesperson, repeated on Monday (10 November) that the Commission would make available all the information and explanation at the necessary level, in accordance to the demands of relevant services of Parliament.
Juncker’s line of defence appears to be that the tax deals were not illegal, and that he will in no way prevent the commissioner responsible for Competition, Margrethe Vestager, from doing her job in investigating the four cases opened so far (two in Luxembourg, one in the Netherlands and one in Ireland). It is however unclear what happens with the other cases.
‘I have free hands to investigate’
Vestager appeared yesterday in front of the Parliament’s Economic and monetary Affairs Committee, where she was previously supposed to discuss with MEPs state aid and competition rules in the banking sector.
The Luxleaks having stolen the agenda, and Vestager was put under pressure by MEPs fire to shed light on how she intends to deal with the issue. Vestager’s main message was that she had “free hands” to investigate, but she played down expectations that Luxleaks would unleash many new probes.
Vestager also said that “tax agreements are not per definition illegal”.
Asked if the leaked documents would be used by the Commission as a basis for investigation, Vestager said the EU executive needed more information from national authorities. “But of course we will take [Luxleaks] into consideration,” she said.
In the meantime, the editors of Bloomberg published an editorial, calling for Juncker to resign.
“Juncker’s position as the head of the body investigating the tax practices he oversaw as prime minister is a clear conflict of interest. […] With Juncker in charge of the commission, any such exoneration will fail to command public confidence,” the Bloomberg editors write.
The responsibility of the press
Spiegel Online published a comment, highlighting the democratic deficit in EU decision-making, and the failures of the EU correspondents in Brussels.
“In contrast to the United States, where getting to know the candidates is a matter of course, the EU never had any intent of truly introducing its leading politicians to the people. This has created a situation in which a person like Juncker can effectively lead two lives. One as an (honest) proponent of the EU and the other as a cunning former leader of an EU member state who promoted Luxembourg’s self-interest by blocking treaties that would have forced the country to adopt stricter tax policies. […] We EU correspondents share some of the blame as well by going too easy on Juncker,” Spiegel writes.
The timing of the revelations by the International Consortium of Investigative Journalists may appear as confusing, as the news broke a couple of days after Juncker’s commission officially took over. EURACTIV sources said that ICIJ was in possession of the 28,000 pages of leaked documents for six months now, and that the publications had been planned for mid-October. However, some partner media being late with preparing their publications, the revelations were made on 5 November.
EURACTIV was told that the purpose of ICIJ has in no way been putting down Juncker from his Commission top job.
- European Parliament: Ms Vestager on Lux leaks: Common corporate tax base good idea, but difficult to persuade member states
- Bloomberg: The Editors: Jean-Claude Juncker needs to go
- Spiegel Online: Democratic Deficit: It's Time to Put Juncker on the Hot Seat
- EURACTIV France: Juncker sous la menace d'une motion de censure au Parlement européen
- The International Consortium of Investigative Journalists: Leaked documents expose global companies’ secret tax deals in Luxembourg