Labour MEPs: Tax haven blacklist a start but EU must go further and back Panama inquiry recommendations

Labour MEPs have welcomed the blacklist of tax havens, agreed by EU finance ministers, but called for them to go further and back the recommendations of the European Parliament Panama inquiry, which are set to be approved by MEPs next week.

The inquiry recommendations include: an end to the unanimity rule on tax decisions, denying countries that are soft on tax dodging a veto; much greater transparency; an EU scrutiny mechanism on newly introduced harmful tax measures; a ban on letterbox companies, whereby a company is domiciled in a low-tax regime while conducting its business elsewhere; a global definition of a tax haven; a voice for developing countries in any international tax body; and a global Summit to fight tax avoidance, evasion and aggressive tax planning.

The Socialists and Democrats Group has also tabled an amendment calling on the EU to renegotiate its trade, economic and other relevant bilateral agreements with Switzerland to bring them in line with EU anti-tax fraud policies and anti-money laundering measures to finally end the Swiss culture of banking secrecy.

Neena Gill MEP, Labour’s European Parliament spokesperson on taxation, said:

“The blacklist of tax havens is a start, but not only does the list itself need to be more extensive, and sanctions agreed, finance ministers must also back the recommendations of the European Parliament Panama inquiry, which MEPs are set to approve next week.

“Tax avoidance may be legal but it is highly immoral. Trillions of euros are being siphoned off through loopholes to avoid tax, while public services are starved of money – there is an estimated €6 billion (£5.3bn) held in tax havens. We have a chance to put an end to this, through an international agreement that outlaws tax havens and imposes sanctions, fines and prison sentences on those that run them.

“This is an ongoing and urgent problem, one that can only be solved by global action, and it is the European Union that is leading on it – instead of sundering ourselves from the EU, as the Hard Brexit fanatics in the Tory Party and DUP have proposed, we must retain the closest possible relationships, and work together to end this scourge.”