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Juncker Grilled By European Parliament Tax Committee

by Ulrika Lomas,, Brussels

07 June 2017

Jean-Claude Juncker has asked members of the European Parliament (MEPs) to judge him on his record on tackling tax avoidance and evasion as the current President of the European commission, not in his previous roles in the Luxembourg Government.

Juncker was responding to questions from the European Parliament's special inquiry committee, set up in the wake of last year's Panama Papers revelations, at a hearing on May 31, in which it was put to him that Luxembourg enabled many multinational companies to avoid tax through special rulings with the tax authority and other legal means while he was the country's Prime Minister.

During the hearing German MEP Sven Giegold told Juncker that although he is now working hard to tackle tax evasion, people still wanted a clear statement of responsibility on what he did in the past. "That is what is still damaging your credibility. I think this is a shame given that you a making positive progress on tax evasion right now," Giegold said.

Juncker responded: "I understand that you would like to know more about the background, but please don't measure my credibility on that basis. We should measure the credibility of this Commission on the basis of what it does now."

Juncker was Luxembourg's prime minister from 1995 to 2013, and its finance minister from 1989 to 2009.

Some MEPs pressed Juncker on the reasons why Luxembourg appeared more frequently in the Panama Papers than other EU member states, to which Juncker replied: "You have to have in mind that these mentions of member states relate to the past. We were living in a totally different world from the one we are in now."

Juncker said he believed that "tax justice is more essential than ever" following the revelations in the Panama papers. He insisted the Commission intends to put an end to unfair tax avoidance practices and will try to make taxation more transparent, fairer, and effective.

The Commission's President referred to some of the progress that had been made recently, including a deal on the automatic exchange of information on tax rulings, and various BEPS-related anti-avoidance measures.

"This is our direct response to the Panama Papers scandal," Juncker said. "The scandals that have been revealed have made our task easier. This pressure should not let off."

However, Juncker declined to take up a proposal by some MEPS to draw up a list of European "tax havens," saying that the Commission does not have the means nor the inclination to name and shame.

TAGS: tax | tax avoidance | banking | Luxembourg | tax authority | agreements | banking secrecy | European Union (EU) | Panama | Europe

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