The draft final report, which the European Parliament's ‘Tax 3’ special commission on financial crime, tax evasion and tax avoidance will adopt on Wednesday 27 February, will set out a series of recommendations, including a stronger fight against money laundering and a request to Member States to abolish their golden visa programme.
The compromise amendments to the draft report defended by Luděk Niedermayer (EPP, Czechia) and Jeppe Kofod (S&D, Denmark), finalised on Monday 25 February between political groups, highlight the lack of cooperation between national authorities in exchanging information in areas such as the fight against money laundering or tax fraud and avoidance.
Echoing the ongoing reform of the EU rules governing the European Financial Supervisory Authorities (see EUROPE 12192), the European Banking Authority (EBA) should be a "leader" in the fight against money laundering and should be provided with sufficient human and material resources, according to the compromise amendments of which EUROPE has received a copy.
But despite the recent intensification of scandals, particularly in the banking sectors of the Nordic and Baltic countries, MEPs should not clearly demand the creation of a European entity competent in the field of 'anti-money laundering'.
On golden visas, which allow for a residence permit, or even the nationality of a Member State, to be granted in exchange for substantial investment in the host country (see EUROPE 12178), MEPs should call on Member States to plan their abolition "as soon as possible".
According to the Tax 3 commission, the economic advantages of the existing schemes (CBI, RBI) do not take precedence over the risks they present in terms of money laundering and tax evasion. The regimes of some countries have been widely used by Russians and citizens of countries under Russian influence, potentially in order to circumvent European sanctions imposed after Russia's annexation of Crimea, underlines a compromise amendment.
The draft report should also ask the Commission to provide a strong European definition of aggressive tax planning. It would agree with the view that seven Member States identified by the European Commission - Belgium, Cyprus, Hungary, Ireland, Luxembourg, Malta and the Netherlands - constitute "jurisdictions facilitating aggressive tax planning at the international level" (see EUROPE 11976).
According to the OECD, Luxembourg and the Netherlands together receive more foreign direct investment than the United States, a significant proportion of which does not produce any obvious substantial economic activity. In Malta, foreign investment represents 1,474% of GDP.
MEPs will argue for effective protection of whistleblowers in both the public and private sectors (see other news).
A detailed analysis of the compliance of non- or uncooperative third countries with tax commitments to the EU will also be required. The report should call for a refinement of the criteria for determining that a court does not cooperate with Member States in tax matters.
The TAX 3 commission will also highlight the blockages in the EU Council on country-by-country tax transparency (see EUROPE 12179), the common corporate tax base (ACIS - CCTB) and taxation in the digital sector (see EUROPE 12158).
As such, does the Council, where decisions are taken unanimously by the Member States, constitute a weak link in the monitoring system? On this point, MEPs should ask the European Council to debate it by the end of 2019.
See the compromise amendments: http://bit.ly/2IzeGFQ. (Original version in French by Mathieu Bion with Marion Fontana)