EU challenges Trump on tax avoidance ahead of G20 summit

The European Union has published a letter to EU heads of state, laying down a direct challenge to the Trump administration, on the issues of tax avoidance ahead of the G20 summit this weekend.

The joint letter, sent by European Commission president Jean-Claude Juncker and European Council president Donald Tusk  to EU heads of state, ahead off the G20 summit in Hamburg this weekend, highlights, “advancing the global fight against tax avoidance and evasion” and points to a bid for a “more resilient international monetary and financial system”.

The letter says that countries not signing up to agreed international standards on tax transparency should “bare the consequences” and face sanctions for non-compliance tax evasion and anonymous ownership of companies, trusts and foundations.

As reported, the USA have refused to sign up to the globally accepted standards on the exchange of banking information between countries (the OECD Common Reporting Standard) and has not implemented measures to make sure US companies publicly disclose their owners, a key measure in the the fight against tax evasion and terrorist financing.

‘One of the world’s largest tax havens’

Commenting on the publication of the letter, Markus Meinzer, board member of the Tax Justice Network said:

“The US has been very aggressive in compelling foreign countries to disclose their information to US tax authorities, but so far has refused to provide the same information about US companies and banks to others. This has led to real fears that the US is turning itself into one of the world’s largest tax havens.

“It is great to see the EU taking a stand on these issues, but it is now time for them to put their money where their mouth is and blacklist the US as a tax haven.

“The EU is the only player with the economic power to persuade the USA to mend their ways.”

Tax abuse

The Tax Justice Network (TJN) is a research and advocacy organisation dedicated to the study of tax havens and tax abuse by multinational companies.

TJN has argued across the last 12 months that the EU was the only institution that would be able to bring sufficient pressure to bare on US financial institutions to force compliance with international standards on tax transparency. More details can be found here

ABOUT THE AUTHOR
Gary Robinson
Deputy Editor, International Investment and Head of Video at Open Door Media Publishing. A fully qualified journalist and filmmaker with more than 20 years' financial services experience, both as journalist and originally as an IFA.

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