EU urges quicker progress on tax-haven blacklist after Panama Papers

The European Union should produce a common blacklist of international tax havens within six months, the bloc's top taxation official said Thursday, trying to give the project fresh momentum after a massive leak detailing tax avoidance practices.

The data leak from the Panama-based law firm Mossack Fonseca, which has come to be known as the Panama Papers, details how money was funnelled to shell companies in tax havens and calls into question the finance of numerous politicians, sports stars and celebrities.

Iceland's prime minister, Sigmundur David Gunnlaugsson, was expected to resign Thursday after the Panama Papers suggested that he and his wife had an offshore company in a Caribbean tax haven.

Tax fraud is an "economic plague," EU Taxation Commissioner Pierre Moscovici told journalists in Brussels as he presented previously prepared plans to combat VAT fraud. He predicted that the Panama disclosures would not be just a "flash in the pan."

"We do not yet know how much of this activity was illegal, but much of it is certainly, first, true and, second, certainly immoral, unethical and in one word unacceptable," he said. "This week's revelations leave me outraged and furious."

"The amounts of money, the jurisdictions and the names associated with this ... are frankly shocking," Moscovici added. "We have to list [tax havens] through a common EU blacklist and be ready to hit them with appropriate sanctions if they refuse to change."

The EU's executive, the European Commission, had already indicated in January that it would pursue a blacklist of non-EU countries that refuse to cooperate in the global clampdown on tax avoidance. This would replace a patchwork of existing EU national lists.

Back in January, the commission had spoken of publishing the list by early 2019, but Moscovici said he now wants it to be ready this year.

"I want this list of tax havens in the next six months at the latest," he said.

Moscovici noted that Panama currently is blacklisted by only eight of the EU's 28 member states. He urged the country to "rethink its position" of not being "willing to enter into constructive dialogue with the EU."

The commissioner also pledged that his institution would "not hesitate to act" if the Panama Papers reveal that EU laws have been broken or that the bloc's legislation contains loopholes.

Moscovici vowed that the EU will "not relent in putting pressure on the rest of world to show the same level of ambition," including at the high-level spring meetings of the International Monetary Fund and World Bank in Washington next week.

Last update: Fri, 24/06/2016 - 08:49

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