Minister of Finance Pierre Gramegna called for a coordinated effort by the international community to deal with tax matters. Speaking at the 4th annual LFF seminar in Milan, Gramegna also highlighted the steps Luxembourg has taken towards greater transparency, and outlined how Luxembourg’s financial centre offers Italian finance professionals an international platform to serve their clients’ business activities.
Minister Gramegna said: “Luxembourg fully shares the concerns on international tax matters. In particular, it is not acceptable that a company may use international regulations in such a way as to avoid any taxation. I fully agree that the problem of double non-taxation must be resolved. However, double non-taxation arises as a result of the interaction of multiple local tax systems. Therefore this issue cannot be dealt with by my country alone and requires a coordinated effort by the international community.”
He continued: “We are discussing this on a OECD and a European level. We have supported, in July 2014, the addition of new provisions to the parent-subsidiary directive, which aim at preventing the double non-taxation of companies through hybrid mismatches. Luxembourg also supports the introduction into this directive of a generalised anti-abuse clause. Fair and efficient solutions are required for all governments, as well as for the international business community.”
On the opportunities Luxembourg offers to the Italian financial services industry, the Minister said: “Being from Italian origin myself, I am particularly pleased that Luxembourg and Italy have always enjoyed a productive relationship. The Luxembourg finance centre offers Italian banking and asset management industries an effective platform to accompany their clients in their international projects. Seven of the top 10 Italian banks already have a presence in Luxembourg. Italy is Luxembourg’s 3rd largest life assurance market. The majority of Italian asset managers use Luxembourg as their global distribution platform for investment funds“.
The diversification model of Luxembourg’s financial centre has prepared Luxembourg well for automatic exchange of information. Luxembourg will implement automatic exchange on the basis of Savings Taxation Directive as of January 1st 2015 and has agreed with the other EU members to an enlarged scope for this directive. Luxembourg is among the early adopters of the application of automatic exchange at OECD level from 2017.
Luxembourg is the leading financial centre in the Eurozone and ranks 15th in the latest Global Financial Centres Index. In the asset management industry, the Grand Duchy is home to 67% of investment funds distributed globally. Luxembourg is among the few countries in the world who have a regulated Family office sector.
The seminar was organised by Luxembourg for Finance, the development agency of Luxembourg as a financial centre, in collaboration with the Italy-Luxembourg Chamber of Commerce and Aifo, the Italian Family Officers Association.