Brussels, 27/04/2009 (Agence Europe) - On Friday 24 April, the European Parliament adopted by a clear majority, the advisory report of Benoît Hamon (PES, France) on the proposal to amend directive 2003/48/EC on savings tax (EUROPE 9782). This endorses the EP's economic and monetary affairs proposal to end the European legislation taxation mechanism in July 2014. This mechanism allows three member states (Austria, Belgium and Luxembourg) as well as several third countries (Andorra, Liechtenstein, Monaco, San Marino and Switzerland), which concluded similar agreements with the EU, not to reveal the identity of those investing their savings on their territory in exchange for a temporary withholding tax (20% until 2011 and 35% afterwards) on the amounts invested, which is then redistributed to the countries of origin. Belgium announced that it would take part as from 2010, in exchange for automatic information exchange in this domain.
In a press release, the rapporteur affirmed: “If Europe wants to be effective in fighting tax evasion, automatic and compulsory information exchange is necessary, as well as the elimination of the withholding tax on savings, which is still applied in two member states”. In its November proposal, the Commission suggested the scrapping of the withholding tax but the dynamic on mutual administrative assistance in tax information initiated at the G20 summit has given new impetus to the partisans of greater transparency. On 23 April, during the plenary debate, László Kovács indicated: “We consider that fixing a date for the end of the transitional period is premature at this stage and could create an obstacle to the necessary quick adoption of the amending proposal by the Council”. The commissioner for taxation explained that “there is actually a need to evaluate when and how the political commitments for enhanced cooperation, which have been taken by a number of jurisdictions, can actually be implemented”. MEPs threw out the amendment by the EPP-ED Group submitted by Astrid Lulling from Luxembourg and Othmar Karas from Austria, who underlined the permanent nature of the withholding tax. Ms Lulling said that “official and non-official studies illustrate that all exchange of information is experiencing serious problems because it is complicated, laborious and costly”. She also stated that “the withholding tax is continuously gaining ground in different member states”. MEPs support the general goal of the proposal to fill in the loopholes in current legislation by incorporating legal constructions into its field of application, such as trusts and non-profit making organisations, as well as innovative financial products e.g. some life-assurance contracts and savings. Mr Hamon asserted that “we have created a list of legal entities and European companies that are very often registered in tax havens and we are asking them to prove that they are paying this tax”. Mr Hamon added that “hiding behind these complex legal structures are often natural persons seeking to avoid paying taxes”. MEPs adopted an amendment from the Greens/EFA calling on the Commission to provide a list of financial products subject to interest payments. They also examined an amendment from the socialists to include all capital payments in life-assurance and old-age insurance to be included in the field of application. (M.B./transl.rh)