The Council of Ministers of the EU is where progressive legislation is often blocked by personal interests. Denmark’s new government is determined to support the public wish for transparency. The UK could be a very constructive force for justice in the EU if it had a more enlightened government.
Ana Maria Gomes MEP points to one of the most destructive influences that the current UK government has exercised in the European Union – blocking transparency over offshore trusts. She acknowledges the important influence the UK will continue to have in the EU, from within or without, and hopes that a more enlightened future government will play a responsible role in the fight against corruption and global inequality.
The issue of taxing multi-national companies (MNCs) as single entities regardless of where they operate is one that goes back to 1932, as John Christensen of the Tax Justice Network points out in his chapter in the book A Vision for Europe. But still in 2019, after so many scandals and the blatant growth of inequality in the era of globalization, there is a struggle going on between governments, over tax harmonisation.
Why do we never hear Nigel Farage talk about the benefits that tax revenue provides to the electorate when he talks about freedom?
He can stand up in the European Parliament complaining about the power of the banks, a good populist theme, and another British MEP complained about the ‘interference’ of the EU in the affairs of tax havens.
Freedom seems to be a word that changes its meaning depending on who the Brexiters are talking to – its pleasant glow can be shone over their demands to ‘take back control’ as if for all our benefits; and it can also mean the freedom that the finance industry claims to pursue its profiteering interests with as little ‘interference’ from taxation as possible. Taking back control in the interests of the country as a whole doesn’t seem to play any part in his concerns.
Ana Gomes discusses the role of the UK in the EU, and specific issues involving different countries, including the Luxembourg freeport, which is an example of a new tool for possible tax avoidance by the rich.
You and MEP Evelyn Regner visited the Freeport in Luxembourg and you were unhappy with Juncker’s lack of cooperation on issues to do with tax avoidance.
It isn’t Juncker, it’s the present Govt of Luxembourg. Freeport is a case of opacity that we are very concerned about because it’s a system that can easily be exploited for money-laundering and tax evasion.
In the past it was Juncker, when he was prime minister of Luxembourg because this was their policy, but we can’t blame the Commission, they were very open. And since he became president of the Commission, he has been very forthcoming and hasn’t blocked any initiatives.
Are you optimistic about the new Danish Govt, since the Socialist Party has said they will do everything possible to stop tax evasion?
They should because one of the last missions I did was to Denmark and Estonia with Angela Regner to follow up on the Danske Bank scandal involving Russian money between 2007 – 2015, and it was the same with Nordske Bank and others, the problem was systemic. In our report we said that the Danish government needed to act, instead of just relying on the courts, but strengthen their anti-money laundering enforcement. This is very worrying because if it can happen in a country that is as transparent as Denmark, it can happen anywhere, and we know that some countries have become real tax havens.
We’ve named five of them, Malta, Cyprus, Ireland, The Netherlands and Luxembourg, but there are others. So, this shows the weakness of anti-money laundering legislation in the EU despite our efforts. We also proposed a European Financial Investigations Unit – and it was blocked by the Council.
It’s been clear for a long time that the UK is one of the biggest contributors to the offshore finance business –
I would say that the US is the father – after they created Panama – and the UK is the mother –
Do you think the UK would do more damage as a Trojan Horse within the EU or if Brexit happens, from outside by attracting the flows of money away from the EU?
I don’t want to make predictions, but regardless of whether you remain or leave, the UK will always have an important influence on the EU, whether positive or negative.
The UK could choose to go ‘rogue’, which has been hinted at by people talking about Singapore in Europe, and this is one more reason for the EU to act. But also, if you remain, yes because it was actually the UK that has boycotted legislation that we were fighting for, in order to create a central register for Trusts. It was the UK who blocked it, so we must watch the UK very carefully, whether they are inside or outside the EU.
People in the UK and many countries are concerned about the various tiers of EU bureaucracy, that they imagine only exist to put public money into the salaries of unnecessary bureaucrats, or even to divert it into their own pockets…
They should be concerned about the various tiers in the UK… A lot of this has been copied from the UK, look at the money that has been laundered through the British offshore tax havens, and also through real estate in the UK and elsewhere.
What I was trying to get at was for example – Nigel Farage can stand up in the EU Parliament and say that he’s against the banks and profiteering, but what he’s actually doing is working in the opposite direction to favour these offshore businesses. So there’s a gap in public perception.
Yes, absolutely, the Brexiters slogan is ‘take back control’ but in the globalized world we live in, the only way to do that and to fight corruption is through co-operation between countries. That’s why we need the EU, and why we need transparency, one country alone can’t make that difference and take back control.
Is your Committee concerned with the recent stories about the mis-spending of EU money by Orban’s Govt in Hungary?
We have a Budgetary Committee in the European Parliament, but of course if any other MEP or Committee hears of something like that, it should be reported, and I have done so on several occasions.
Hungary is the worst case, but in Romania the leader of the Social Democrats who was also the Speaker in the Romanian parliament, has just gone to jail because he was found guilty of creating a criminal fund that diverted €21 million of EU money. When we discover these things, we begin investigations in conjunction with national authorities.
Will your Committee continue in existence?
I hope so, but let’s see what the new EP will do. We have proposed that it should become a permanent committee with inquiry powers, and able to produce recommendations for action.
Do you have any further comments?
No, but in my opinion, this is a situation where the UK could make a hell of a difference, if it would be engaged inside the EU, and the EP. We have seen a lot of blocking moves by the UK, but it could be the other way round if there was another enlightened leadership in the UK.