EP tax avoidance fact-finding mission in Luxembourg

The European Parliament’s so-called Panama Committee (PANA) is visiting Luxembourg on a fact-finding mission from March 2 to 3. Meeting with Finance Minister Gramegna, Justice Minister Braz and the Finance Committee of Luxembourg’s Parliament, criticism has been voiced about the country’s finance sector not being willing to cooperate.

Luxembourg is the third country which the PANA Committee is visiting in the framework of its mandate to investigate money laundering, tax avoidance and tax evasion. The Committee already visited London and Malta.

Established in the wake of the Panama Papers leaks, the PANA Committee says on its website: “The purpose of these meetings is to look into the implementation and enforcement of EU law in relation to money laundering, tax avoidance and evasion, and more generally, to draw up possible responses at a European and national level to counter tax evasion, tax avoidance and money laundering. “

Finance Minister Gramegna (DP) and Justice Minister Braz (DéiGréng) agreed to meet with the members of PANA. The same goes for the President (Eugène Berger, DP) of the Finance Committee of Luxembourg’s Parliament and its members.

Luxembourg’s finance sector not cooperating

However, numerous companies active in Luxembourg’s finance sector have denied to meet with the PANA Commission.

Sven Giegold, a green MEP from Germany that has been spearheading the fight against tax evasion, published a list of the respective companies.

These include three of the big four consultancy firms (E&Y, Deloitte, KPMG), Experta (a subsidiary of the Banque International à Luxembourg), Banks Safra-Sarasin and Landsbanki, but also lawyers Albert Wildgen and Alain Streichen as well as Marius Kohl, famous for his role in the Luxleaks scandal being the former head of Luxembourg’s tax ruling department.

Giegold sees these refusals of meeting with the PANA Committee as a lack of respect for the European Parliament and said “those who don’t dare to appear before the Committee create the impression of having to hide something”.

Deploring the apparent lack of willingness to cooperate, Giegold threatened to ask for the lobby groups of the respective companies to be denied entrance to the European Parliament in future.

Luxembourg’s MP David Wagner (DéiLénk) has no understanding for the negative responses from these companies either: “We are being told constantly that there have been no illegal activities. So there should be no reason to hide from the EP’s investigative committee”.

Wagner’s colleague from the European Parliament and Vice-Chair of the PANA Committee Fabio De Masi (Die Linke) added: “Luxembourg is not the only tax swamp in the EU, but it is one of the central actors in the web of shell companies.

“Luxembourg’s government is continuing to block central transparency projects such as the public country-by-country reporting for companies. A change in culture after Luxleaks seems to be a mirage”, he went on to say.

The Panama Committee

The European Parliaments Panama Committee, officially Committee of Inquiry to investigate alleged contraventions and maladministration in the application of Union law in relation to money laundering, tax avoidance and tax evasion, was established following the Panama Papers leaks on June 8, 2016.

During its twelve-month mandate, the Committee will have the opportunity to investigate the alleged failures which allowed instances of money laundering, tax evasion and tax avoidance. At the end of this period, a report will be submitted with recommendations.