On Thursday, 27 October the FISC subcommittee of the European Parliament invited two experts from the OECD and the IFO institute to discuss tax policies introduced in EU Members States in response to increasing energy prices as well as the high inflation. The discussion evolved around the question, what taxation can do to ease the current crisis. According to the research of Ms Elgouacem from the OECD one third of all government measures are tax related. Nevertheless, she warned that current measures were mainly benefitting the fossil fuel industry. For a better crisis management and to increase households’ purchasing power, governments should focus on targeted income support and renewables. Mr Fuest from the IFO institute warned that price caps and subsidies would not help reduce demand, which is crucial in light of the lack of supply of energy. He claimed that introducing a net wealth tax would lead to capital flight and harm the economy and that governments should focus on existing tax laws to tackle the crisis.
MEP Niels Fuglsang, the S&D rapporteur from Denmark, presented his draft report focussing on his five priorities: - all EU Member States should implement the Whistleblower Directive from 2019 in order to better protect whistleblowers; - politically exposed persons must declare all their activities and assets; - cooling-off periods should be introduced for officials who work for tax authorities and want to work in the private sector; - transparency of beneficial ownership information should be guaranteed by governments; - introduction of wealth taxes on certain assets and coordination of those within the EU. The report was largely welcomed throughout all political groups in the committee. Amendments can still be tabled until 22 November, a vote in the committee is scheduled for 31 January 2023.
In a letter to Transparency International’s EU Director, Michiel van Hulten, Commissioner Mairead McGuinness allegedly revealed the EU’s plan to include the United Arab Emirates in the EU’s list of high risk third countries regarding AML. The list consists of third countries which have strategic deficiencies in their AML/CFT regimes that pose significant threats to the financial system of the Union and could distort the functioning of the single market. The 4th AML-Directive defines criteria that help identify such high-risk countries. Transparency International had claimed in an open letter to the Commission that the UAE were a safe haven for Russian oligarchs and political elite to make use of the countries’ non-transparent financial system to store their assets. “UAE’s extensive involvement in financial, economic, corporate and trading activities as well as its involvement in oil, diamond and gold exports, poses significant risks for money laundering” the letter says.
The OECD’s Global Forum on Transparency and Exchange of Information for Tax Purposes will be held from 9-11 November in Seville, Spain. The Global Forum consists of 165 members and is the leading international body working on the implementation of global transparency and exchange of information standards around the world. The three-day meeting will bring together ministers, other high-level authorities and delegates from more than 100 member jurisdictions. During the meeting delegates will, among others, present peer review reports of the Automatic Exchange of Financial Account Information 2022. The sessions on day 1 will be broadcast live on OECD TV.