The European Union caved into pressure from Germany yesterday and agreed to
consider a clampdown on tax havens – despite opposition from Luxembourg which
said it saw no reason to change current laws.
The European Commission is set to begin a lengthy process to expand current
laws to prevent its citizens evading tax on the interest accumulated on offshore
savings.
EU tax commissioner Laszlo Kovacs yesterday proposed an extension to the
scope of the EU’s directive on taxation of savings in bank accounts. Kovacs said
this would be done by including trusts or foundations to the list of products
already covered by existing laws, the International Herald Tribune
reported.
Tax havens came under wide scrutiny of authorities in Europe afterGermany
cracked down on evaders in Liechtenstein. Germany then
lobbied for EU ministers to speed up planned reviews of the tax laws relating
to offshore savings.The concern spread abroad, leading authorities in Australia
and Germany to carry out audits and raids on their wealthiest residents.
Luxembourg, which defends banking secrecy, underlined its position yesterday.
Finance minister Luc Frieden said he saw no loopholes in the current rules. He
added that any changes ‘would certainly need a lot of time’.
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