Debate: Implementation of EU requirements for exchange of tax information
Date: WEDNESDAY, 15 SEPTEMBER 2021
Speaker: Sven Giegold
Language: EN

Our implementation report deals with the important implementation of EU rules when it comes to the exchange of tax information between Member States. Faced with hundreds of billions of taxes lost through international tax evasion, tax avoidance and tax fraud, this is a topic of high interest to the citizens, who of course would like to see tax justice and fair competition in our common market. I would like to thank warmly all the colleagues from the different political groups who have been contributing to that important work over much more than a year. However, our work to assess the effectiveness of the first four directives on administrative cooperation and tax matters was hampered by the refusal of the Member States, with the notable exception of Sweden and Finland, to provide access to the documents needed for our work. The European Commission, too, interpreted EU law in a very narrow way, which is unfriendly to Parliament’s work and refused also access to information available to the Commission, which would have been available very likely to citizens if they went to court.  I would therefore like to recall that according to the European Treaties, the European Parliament has the right and the responsibility to control the Commission in its work, and therefore needs the respective information. Nevertheless, we were able to gain significant insights based on publicly available information, studies and accounts provided by several whistle-blowers. I would also like to highlight the report by the European Court of Auditors and the study commissioned by the European Parliament’s research service, which significantly helped us to identify areas for improvement. Thank you to all those who contributed. Eleven years ago, the first Directive on administrative cooperation in tax matters laid the groundwork for tax administrations to support each other in the fight against tax avoidance, tax evasion and tax fraud across Europe. With each of six extensions, important categories of tax-relevant data were included step by step under the Directive. This is great progress, however still unfinished, but this progress in European tax law has not been matched with equal ambition when it comes to the effective implementation of these rules in the Member States.  While 16 Member States have implemented the rules for the automatic exchange of tax information within the EU sufficiently, we found shortcomings in 10 Member States, namely Belgium, Croatia, the Czech Republic, Estonia, Germany, Hungary, Latvia, the Netherlands, Poland and the Slovak Republic. Most worryingly, Romania does not have the legal framework in place, which is a prerequisite for the automatic exchange of tax information.  Similarly, reviews of the measures taken by the Member States to prevent money laundering and terrorist financing reveal worrying deficiencies with direct effect on the effective information exchange on tax matters. Of the 18 Member States reviewed, none of them received a rating indicating a high level of effectiveness. This indicates a clear lack of effective implementation of the measures needed to prevent financial crime.  Despite these internationally documented shortcomings in the implementation of EU law, the Commission has not opened a single case of Treaty violation because of the lack of effective implementation of tax information exchange. Equally, we found a lack of access to tax-relevant information when it comes to assets and incomes from real estate companies and other types of assets. These asset classes should be included as soon as possible in the upcoming revision of Directive No 8.  In her State of the Union address earlier today, Commission President Ursula von der Leyen committed to fighting tax evasion, tax avoidance and tax fraud. Therefore, I’m asking Commissioner Gentiloni: you have previously confirmed to us you may open infringement proceedings in the area of tax cooperation whenever needed. Considering the deficiencies identified in many Member States in my report, when will the Commission take action? And will you strengthen the Directive on Tax Administration as Parliament proposes in your eighth revision? Thank you very much to all of you who contributed and for listening to me.