Europe's push against tax fraud gains momentum

 
EU Commission President Barroso and UK Prime Minister Cameron, 22 May 13 Will Mr Cameron and the EU convert words into action on tax evasion?

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David Cameron began his day by restating his position that he not only wants to reform the European Union but that Britain was better off in a reformed EU.

Today is an example of how work gets done in Europe. There is what is called a "thematic summit". There are two main items on the agenda: tax evasion and energy. They will be discussed over lunch and five hours later the motorcades will be heading for the airport or the Gare du Midi.

Over tax fraud David Cameron has allies. He wants global action against what he has described as "staggering" losses to the national exchequers. It is estimated in the EU that 1tn euros ($1.3tn; £0.85tn) are lost each year due to tax fraud. Mr Cameron wants to adopt the US proposal of an automatic exchange of tax-related information. He also wants major companies to report tax payments on a country-by-country basis. This is to prevent shifting income to those places with the lowest tax rates.

On arrival in Brussels Mr Cameron said "we've got to make sure that as we set those tax rates that companies pay taxes and that means international collaboration, sharing of tax information".

On one level it is easy to find co-operation on this. The mood of the times has changed. With so many countries cutting spending in Europe it is very appealing to go after tax fraud. Also a combination of activists and hackers have exposed how multinational companies evade taxes.

There are, however, sceptics about this. They point out that commitments have been made before to tackle tax havens. The Italian Prime Minister, Enrico Letta, for one, has spoken of "the incredible hypocrisy" on a European level.

There are still countries like Austria and Luxembourg which are resisting sharing information, although the Austrian Chancellor Werner Faymann said today "we want united rules... it's an injustice and we have to act jointly against tax fraud".

How determined is UK?

Within the EU there are those who say that Britain has not cleaned up its tax havens. David Cameron has written to UK "dependencies" and told them to embrace tax transparency - but that is a long way from ensuring it will happen.

In the UK there is controversy about Google and the tax it pays. Ed Miliband, the Labour leader, said today "I can't be the only person here who feels disappointed that such a great company as Google, with such great founding principles, will be reduced to arguing that when it employs thousands of people in Britain, makes billions of pounds of revenue in Britain... that it should pay just a fraction of one per cent of that in tax."

The Labour leader challenged David Cameron as to whether he had raised this issue with Eric Schmidt of Google earlier in the week.

The British believe that clamping down on fraud is best done at a global level, with further agreement at the G8 meeting next month and then later with the G20.

It will be interesting to see whether some European states or EU officials try and develop their own alternative standard with Europe-wide legislation. It will be a test whether on an important issue Europe can be pragmatic and flexible in its decision-making.

The summit will also discuss energy. It is a vast subject and vital to the future of Europe and its economies.

Today is for talking rather than decision-making. The challenge is this: the United States has embraced shale gas and the technique of fracking. It already delivers 25% of America's energy needs, at a cost which gives the United States a real advantage over Europe. The question is not just about whether to back fracking; it is also whether Europe and its decision-making is nimble enough to develop cheaper and more reliable sources of energy.

 
Gavin Hewitt, Europe editor Article written by Gavin Hewitt Gavin Hewitt Europe editor

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  • rate this
    0

    Comment number 171.

    133"The Battle of Cable Street took place on Sunday 4 October 1936 in Cable Street in the East End of London. It was a clash between the Metropolitan Police, overseeing a march by the British Union of Fascists, led by Oswald Mosley, and anti-fascists, including local Jewish, socialist, anarchist, Irish and communist groups"

    That was by a small group 77 years ago.What has any of them done since?

  • rate this
    +1

    Comment number 170.

    #168 MH

    --what we have is a condemning of everything EU --no matter if their misery just gets worse.

    -- fits in with my theory of national direction -- often leading eventually to societal insanity.

  • rate this
    +2

    Comment number 169.

    152 Wolfie

    "They & the island govs are exemplary compared with most at this summit"

    If true why can't they do the same at home?

    The City of London is the biggest money laundering operation in the world and many of its banks have been fined for it incl Coutts the Queen's bankers and HSBC

    Its banksters are notorious so how can they be expected to clean out the augean stables?

  • rate this
    +2

    Comment number 168.

    167 QOT

    "Most Brits don´t know the difference between olive oil and diesel"

    Until a decade or so ago, the only olive oil you could buy here was in little medicine bottles from the chemists - normally used for softening ear wax!)

    The picture of a EU-sceptic expressing sympathy for a Greek olive oil producer is just too ludicrous to behold

  • rate this
    0

    Comment number 167.

    #166 dmr

    --I am not a nationalist --and support informed (and non-imformed) consumers.

    -- The UK abstained ?

    --source ?

    --Next problem !

    http://www.spiegel.de/international/business/german-brewers-oppose-fracking-because-of-fear-over-clean-water-a-901474.html

  • rate this
    0

    Comment number 166.

    The UK abstained, Germany and Holland were the most outspoken about how ridiculous the new law was
    Germany, Denmark, Sweden, Austria and Finland opposed the new law, all Southern European countries were for.
    First time I've known you support Greece against Germany!

  • rate this
    0

    Comment number 165.

    #164

    "Consumers were unhappy about the ban."

    --Most Brits don´t know the difference between olive oil and diesel.

    -- not exactly informed consumers --to accept adulterated produce.

  • rate this
    -1

    Comment number 164.

    Consumers were unhappy about the ban.
    In reality it meant olive oil producers would benefit enormously, that's why the olive oil 'mafia' lobbyists are spitting blood about the consumer winning for s change.

  • rate this
    0

    Comment number 163.

    #156 dmr

    --bad news !

    http://www.bbc.co.uk/news/world-europe-22644280

    "But critics, including British PM David Cameron, accused the EU of meddling."

    -- Again Brits responsible ?

    "Mr Cameron earlier said the proposal was a sign of unwarranted EU interference. The British leader has been facing growing pressure at home from eurosceptics who want Britain to leave the EU."

  • rate this
    0

    Comment number 162.

    #156 dmr

    -- the ´telephone mafia´in Germany has also had their problems.

    --all suppliers must state the price BEFORE connecting --whether fixed line or mobile. Call to USA 0.5 Euro cents/ min. also approx same all over Europe and to UK. Thailand mobile 1.5 cents/min.

    #156 dmr

    -- First theTelegraph ???

    -the discussion of ´olive oil mafia´has been going on for years.

    --Cameron against !

  • rate this
    0

    Comment number 161.

    QOT, the olive oil mafia and the EU were speaking with one voice!
    Its only when consumers rebelled and the Telegraph newspaper highlighted what was happening, the EU backed down as they looked ridiculous.
    Lobbyist and EU 0-consumer 1

  • rate this
    0

    Comment number 160.

    #156 dmr

    --In Germany the EU has clamped down on the ´potato mafia´ -fixed high prices in supermarkets -- that allow small local shops and markets to charge even more.

    --hope next in line is the Europe wide (and UK) ´mussel mafia´--they are now a luxury --from UK to Poland.

    -even they are being adulterated with tropical mussels -- mealy in texture because of high temperatures.

    --go EU go !

  • rate this
    0

    Comment number 159.

    It just meant that restaurants would have to open a new bottle for each customer. The cost of meals would be considerably more.
    No wonder the olive oil mafia are livid the people are being listened to for a change.
    First time ever, European citizens voices are louder than lobbyist.
    I think this is because they are running scared, they are so unpopular.

  • rate this
    0

    Comment number 158.

    #156 dmr

    "A classic example of big business running the EU are the new Olive oil laws. "

    -- One of the biggest mafia is the ´olive oil mafia´--even with a label on the bottle.

    Do you really believe that a restaurant that evades taxes will always place un-aduterated olive oil on the table ?

    -- perhaps with a label --one has more luck ?

    --I´m in favor of the law --it should have come sooner

  • Comment number 157.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    0

    Comment number 156.

    QOT, it's Austria who is trying to stop the tax status investigations.
    They and Luxemberg have the most to lose.
    A classic example of big business running the EU are the new Olive oil laws. The new laws were voted by a committee, no MEP input even. The oil industry is fuming that the EU have backed down to pressure from ordinary people.

  • rate this
    0

    Comment number 155.

    #148 LucyJ

    --All is swathed in secrecy, have been unable to find internet info. The UK tax havens probably play a role --especially with income from land and property in the ex-colonies still owned from colonial times.

    -That is the REAL ´sovereignty´ the UK elite is protecting from EU.

    --all else is only a decoy and ´red herring´ -- and is being swallowed by most --hook, line and sinker

  • rate this
    0

    Comment number 154.

    dmr@151
    "there was good"
    But, BBC implies years of 'alignment' with suffering of others, perhaps unmet need for role, induction of hatred as 'of overwhelmingly evil', enough to make of strangers - in high likelihood personally innocents - targets of heartless violence, thinking simply 'to make a point strongly': apparently not mere psychopathy, but some reflection on.. the world that includes 'us'

  • rate this
    0

    Comment number 153.

    #148 LucyJ

    --The British elite have had centuries to rig the system for their benefit-- beginning with the Colonies.

    -- The reason the eldest son usually inherited was to avoid inheritance tax due after 1st sale. The land and buildings did not have to be registered until then-- villages and at times small towns.

    http://vaticproject.blogspot.de/2010/03/who-owns-britain-biggest-landowners.html

  • rate this
    0

    Comment number 152.

    UK dependencies: UK retail banks operating there are rigorous in making sure tax is paid & to the right govt. Indeed, they & the island govs are exemplary compared with most at this summit

    ‘Hypocrisy’: certainly, these are politicians condemning tax evasion!

    Accountancy: a wise old engineer said, ‘Accountancy tells you how much tax you will pay & very little about how much cash you have’

 

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