The Green Party’s finance speaker has challenged Chancellor George Osborne to respond to new information over the extent of lawbreaking in connection with sweetheart tax deals agreed in Luxembourg and other EU member states. Molly Scott Cato MEP, a member of the European Parliament’s tax working group, is making the call following the release of a confidential document from the Council working group on business taxation. The document was released to the Greens in Brussels in the context of their attempts to set up an inquiry committee to explore legal breaches in connection with the Luxleaks scandal. Dr Scott Cato said:

“George Osborne has previously condemned corporate tax avoidance as ‘morally repugnant’ and announced a profit sharing levy in his recent Autumn statement. Yet there has been no sign of him encouraging Conservative MEPs to join the Greens in a call for a full inquiry into illegal and anti-competitive tax agreements.

“The documents we are releasing today show that there has been even more widespread maladministration and violation of EU law then we at first suspected. It is now all the more vital that Osborne overcomes his reluctance to cooperate with his European partners and works together with them to ensure corporations pay the taxes that treasuries need to invest in public services and infrastructure.”

The Green Group in the European Parliament presented the leaked document at a press briefing today. It revealed that an information exchange obligation on tax rulings, proposed by President Juncker in response to Lux Leaks, already existed but was either ignored or not implemented. [1]  

Notes

[1] The Green Group in the European Parliament presented the leaked document at a press briefing today. It shows that an information exchange obligation on tax rulings, proposed by President Juncker in response to Lux Leaks, already existed but was either ignored or not implemented. A legal provision on spontaneous information exchange on problematic tax rulings has existed since a 1977 Council directive, and was reaffirmed in a new Council directive in 2011. The leaked code of conduct from 2012 was necessary because of member states flagrant violation of the earlier Directive. It provides further clarification and support and extension of the mandate of the proposed inquiry committee, which now needs to cover breaches of EU tax law as well as just competition law and the sincere cooperation principle.

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