Anneliese Dodds MEP

The South East's Voice in Europe

Remember, remember the 5th of November

Today, the 5th of November, is an important anniversary.  

On this day in history, details of a plot were uncovered - a plot to undermine the legitimacy of the state; a plot which so angered ordinary citizens that they rose up and demanded action be taken.

Today marks exactly a year since the 'Lux Leaks' scandal broke and we discovered that hundreds and hundreds of multinational companies had been making arrangements with the Luxembourg government to reduce their tax bills to almost nothing.  Thanks to the brave actions of whistleblower Antoine Deltour and the tireless efforts of the International Consortium of Investigative Journalists, we got hard evidence of what many of us had suspected for a long time: that some companies were doing all they could to reduce their tax bills, and that national governments were more than happy to help them - no matter what the impact on other countries, nor on ordinary people across Europe.

Anniversaries provide an opportunity to look back and take stock.  What has happened since Lux Leaks?  Is the tax system fairer?

First, the good news.  In response to the scandal, my fellow MEPs and I in the European Parliament have made some progress in stamping out aggressive tax avoidance and tax evasion.  A special tax committee was set up, and we have held hearings with tax experts, cross-examined the European Commission President Jean-Claude Juncker and CEOs of major companies, and visited countries across Europe to work out what is rotten and how we can fix it.  The committee finished its report last week, and it sets out a bold and ambitious set of reform proposals: for multinational companies to publicly declare where they make their profits and where they pay their taxes; for better protection for whistleblowers like Antoine Deltour; and for a crackdown on the use of tax havens.

The European Commission - the EU's civil servants - have also taken action.  Earlier this year, they set out plans to compel governments to declare whenever they have made sweetheart deals with companies (the so-called 'tax rulings' at the centre of Lux Leaks) as well as a new, fairer way of calculating tax across Europe so that big companies always pay their tax in the same place that they make their profits.  In some areas the ambition could have been higher, but overall the Commission should be applauded.

Now, the bad news.  Most of the powers to really effect change are in the hands of individual EU governments.  And their response in many cases has been woeful.

At every turn, the national governments that make up the European Council seem determined to pursue narrow self-interest above greater unity.  They have watered down the plans to exchange information about 'tax rulings'.  They have held up negotiations towards introducing public country-by-country reporting for multinational companies.  And they have already indicated that they might well block plans for a fairer way of calculating tax. 

It is David Cameron's UK government that seems to be leading the way when it comes to blocking tax transparency.  As the Guardian reports today, the UK is one of a number of countries who refused to let MEPs even look at key documents on tax when carrying out our investigations.  And the UK "welcomed" the decision last month to dramatically reduce the scope of the proposals for sharing information on tax rulings.

This would be bad enough if the Tory government were at least honest about its opposition to tax transparency.  But the fact is that David Cameron is more than happy to make the right noises about tax if it will get him a favourable headline.  Back in 2013, when the UK was at the head of the G8, Cameron said he wanted "a more serious debate on tax avoidance and tax evasion".  He called it "an idea whose time has come".  Those are admirable sentiments.  Unfortunately they are completely at odds with the action he has taken ever since.

That's why today, I - along with Shadow Chancellor John McDonnell, renowned economist Thomas Piketty and over thirty others - have called on governments across Europe, including our own, to listen to their citizens and crack down on tax dodging once and for all.

This problem isn't going away.  We will remember.  So I call on David Cameron, and his fellow leaders, with a simple message: by this time next year, give us a reason to celebrate rather than commiserate.

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