02 February 2015

Financial Times: Déjà vu - have Juncker’s tax reforms already been debated?

According to a leaked document, both the commission and member states have long been aware of the problem of cross-border tax-rulings – and had already looked into ensuring the automatic exchange of tax information.

Cast your mind back to November.

Jean-Claude Juncker, the new European Commission president, was being pummeled by the European Parliament after a leak revealed widespread tax avoidance in Luxembourg while he was prime minister of the Grand Duchy.

Like Captain Renault in Casablanca, MEPs queued up during a failed vote of no confidence to declare themselves “shocked, shocked” that tax avoidance was going on in Luxembourg.

In a bid to quell the criticism, Mr Juncker said that a lack of tax harmonization within the EU was to blame. To combat this, the commission president said he would introduce legislation to force the automatic exchange of tax-rulings that affect companies based in other member states.

But, according to a leaked document from 2012, both the commission and member states have long been aware of the problem of cross-border tax-rulings – and had already looked into ensuring the automatic exchange of tax information.

The Code of Conduct Group, which looks at business taxation with the commission, came out with guidance in 2012 to encourage member states to “spontaneously exchange the relevant information” on cross border tax rulings. They then asked member states how feasible this was.

Full article on Financial Times (subscription required)

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