In the light of the recent revelations about Luxembourg tax avoidance schemes for multinational corporations, a quarter of the European Parliament on Wednesday (14 January) backed the Greens’ proposal to set up a full inquiry committee on tax evasion and dumping.
Managing to get the required support of 188 MEPs (25% of the House), after a first unsuccessful attempt last December, the Greens now want the Parliament’s president, Martin Schulz, to set up the committee.
The Greens insist that such committee is the most appropriate and significant tool available to investigate the so-called Luxleaks revelations and ensure a comprehensive EU-level response.
After the second wave of Luxleaks in December, European Commission President Jean-Claude Juncker took responsibility for his country’s tax practices. He said he would fight tax evasion with the automatic exchange of information during his term in Brussels.
More than 300 companies, including PepsiCo Inc, AIG Inc and Deutsche Bank AG, secured secret deals from Luxembourg to slash their tax bills, the International Consortium of Investigative Journalists (ICIJ) reported on 5 November, quoting leaked documents.
“This is not a committee against Mr Juncker,” said Greens/EFA co-president Philippe Lamberts, speaking to the press in Strasbourg.
“We are not the enemy of Mr Juncker, we are the enemy of tax evasion,” he added, noting that it is time to put an end to the tax competition war among member states as it is hampering the proper implementation of the single market.
Aggressive tax competition by the Netherlands, Luxembourg, Ireland, Austria and others is a breach of the treaty obligation of sincere cooperation between EU member states, the Greens said.
Luxleaks is a watershed moment in the battle against tax evasion, and the issues raised by these leaks must be subject to a thorough inquiry,” said Sven Giegold, the Greens’ economic and finance spokesperson.
The last time that the European Parliament set up a committee of inquiry to investigate cases of breaches or poor application of EU law was on the Equitable Life scandal and the Bovine Spongiform Encephalopathy (BSE), or mad cow disease, before that.
Liberals’ president Guy Verhofstadt said he had no problem with the setting up of an enquiry committee but insisted on the need to accelerate work on the legislative proposals in order to find a European solution against tax evasion and tax fraud.
“European citizens expect us to deliver results by changing tax practices in Europe,” he added.