CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Finance Ministry Reacts To Latest 'LuxLeaks'

Finance Ministry Reacts To Latest 'LuxLeaks'

by Ulrika Lomas,, Brussels

12 December 2014

Responding to another leak, the Luxembourg Finance Ministry has said that the advance tax rulings issued to multinationals by the country's tax authority are not, and never have been, secret.

The Ministry issued a statement on December 10 acknowledging the publication by the International Consortium of Investigative Journalists (ICIJ) of a further tranche of advance tax rulings. It said that, as with previous publications (the so-called "Luxleaks"), the way in which the documents were acquired is highly questionable.

The statement added that these rulings are neither contracts nor mutual agreements, but rather unilateral decisions taken by the tax authority. Luxembourg, upon request, exchanges information on rulings with other countries. It does so under its double taxation agreements and in agreements on administrative cooperation and mutual assistance in tax matters, the Government said.

The Ministry likewise urged the necessity of taking a broader view of the situation, instead of one limited to a single country's regulatory framework. "The international community as a whole faces a responsibility to adapt international regulations to current realities. Luxembourg actively supports the corresponding European and international initiatives, including with regard to the use of tax rulings," the statement stressed.

Alongside its statement, the Ministry published a position paper on tax transparency and rulings. It elaborates on the process involved, and explains that "it is mandatory for companies to demonstrate to the Luxembourg tax authorities that they have appropriate economic substance and are genuinely active in Luxembourg."

The document say Luxembourg law does not authorize the Finance Minister to interfere in the work of the tax authorities; the tax authority works independently, while applying the tax law to individual cases, under the control of the tax courts.

The Government recently submitted to Parliament a draft law which provides an enhanced framework for tax rulings. It proposes the formalization and modernization of the current practice, taking into account the current global trend toward increased transparency. The Ministry expects the law to be adopted by Parliament before the end of the year. It should come into force on January 1, 2015.

"Luxembourg is a legitimate player in the global economy and a strong advocate for free and open markets, as well as for a fair competition among nations," the position paper concludes.

TAGS: court | compliance | Finance | tax | business | tax compliance | revenue guidance | law | Luxembourg | ministry of finance | tax authority | agreements | multinationals | tax planning | transfer pricing | tax rates | revenue statistics | tax reform | regulation | Europe | Invest

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »