European experts discussed the future of the transparency project in the fight against tax fraud and evasion, and in particular beneficial ownership registers, at a conference organised by the Centre for European Policy Studies (CEPS) and the UK Mission to the EU on Tuesday 21 March.
Rahul Sahgal, deputy head of the tax department at the Swiss State Secretariat for International Finance, said the priority is to have a register that meets international standards.
The common standard on transparency and exchange of information on financial accounts for tax purposes (CRS) only allows for information on financial accounts, explained Philip Kerfs, head of the international cooperation unit at the OECD’s Centre for Tax Policy and Administration. “It never had the ambition to cover art or real estate”, he said. However, these types of assets are used in cases of tax evasion and avoidance.
For Benjamin Angel, Director for direct taxation, tax coordination, economic analyses and evaluation at the DG TAXUD of the European Commission, one of the priorities is to automate the exchange of tax information between jurisdictions. The EU intends to extend this automation to third countries as well.
Achim Pross, Deputy Director of the OECD’s Centre for Tax Policy and Administration, also recommended this solution. According to him, evasion can be “reduced through automation”. Compliance must be thought of by design through “a future system of interconnected registers” including beneficial ownership data, he said.
For Aikaterini Pantazatou, Professor of Tax Law at the University of Luxembourg, these registers face several obstacles. As the judgments of the Court of Justice of the EU (see EUROPE 13068/28) and the European Court of Human Rights have shown, they run counter to the fundamental right of taxpayers to have their personal information protected. “The concept of beneficial ownership registers is fundamental, but difficult to implement because of the diversity of interpretations”, she explained.
Furthermore, the laws do not specifically state what constitutes a ‘legitimate interest’. Ms Pantazatou therefore called on European legislators to spell out exactly what is meant by this concept, so as not to override court rulings.
The European Parliament is due to adopt its position on the anti-money laundering package on Tuesday 28 March, which includes the establishment of a public register of beneficial ownership (see EUROPE 13114/6).
On this point, Mr Angel explained that compliance between registers and the General Data Protection Regulation (GDPR) would be discussed on Wednesday 22 March at a meeting of the European Data Protection Board. (Original version in French by Anne Damiani)