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02/12/2016

Schäuble urges EU to boost transparency on tax deals

Euro & Finance

Schäuble urges EU to boost transparency on tax deals

Wolfgang Schäuble [European Council]

German Finance Minister Wolfgang Schäuble has sent proposals to the European Commissioner for Economic and Financial Affairs, urging him to act quickly to improve the exchange of information on tax deals with companies, a move linked to allegations against Luxembourg.

A finance ministry spokesman said on Wednesday that Schäuble had made concrete suggestions because he believed Europe needed to guarantee fairness and transparency on tax.

“I would very much be in favour of the European Commission taking the initiative to include information on so-called (tax) rulings in the spontaneous exchange of information,” wrote Schäuble to Pierre Moscovici in a letter dated Nov. 11.

“With such a move, the information between the tax authorities of member states could be substantially improved quickly and in a legally binding way,” wrote Schaeuble in the letter, seen by Reuters.

This, said the ministry spokesman, coincided with the aim of the Group of 20 to combat unfair tax practices.

“The goal of the initiative is to limit big companies’ disproportionate room for maneuver on tax… Not everything that is legally possible corresponds to the need for fairness,” he told a regular government news conference.

Luxembourg is defending itself against allegations about sweetheart deals between multinationals and tax authorities.

On Wednesday, the new European Commission President Jean-Claude Juncker, a former Luxembourg prime minister, took responsibility for his country’s tax practices. He said he would fight tax evasion with a greater automatic exchange of information during his term in Brussels.

“Throughout my life, I have worked for more fiscal harmonisation,” he said, announcing that he had proposed to the college of commissioners that automatic exchange of tax rulings should be made compulsory. He added that such exchanges should become global, saying he will make a proposal to that effect at the G20 meeting this weekend in Brisbane, Australia.

>> Read: Juncker breaks cover on Luxleaks