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EU Cites Panama Papers as Underscoring Urgency in Tax Reform

  • Nations told to make quick progress to further transparency
  • Tax information leak has prompted EU to look at further steps

The European Union is planning to step up its fight against tax evasion and money laundering as highlighted by the leaked Panamanian documents that exposed billions of dollars in assets hidden in shell companies around the world.

European Commission Vice President Valdis Dombrovskis sent a note to Jeroen Dijsselbloem, finance minister for the Netherlands, which holds the bloc’s rotating presidency, outlining the commission’s proposals to combat the avoidance of duties as well as further steps that need to be taken, according to a copy of the documents obtained by Bloomberg News.

“The commission will play its role in delivering the initiatives necessary to tighten the EU’s defenses against such tax abuse,” Dombrovskis wrote in the note that will form a basis of discussions at a meeting of EU finance ministers in Amsterdam on April 22. The bloc’s 28 governments should “make quick and substantive progress to further tax transparency and fair taxation,” he said.

The leak this month of millions of pages of financial records from the Panamanian law firm Mossack Fonseca & Co. exposed billions of dollars hidden in tax havens around the world, implicating world leaders and prominent business people from Europe to Asia.

Among the commission’s requests is that nations “provide swift and unequivocal political support” for a common EU list of countries that enable tax abuse. “The Panama papers have highlighted the relevance of such lists and their potential to target problematic tax jurisdictions,” and nations should agree on countries to be assessed for this purpose before the end of the year, the document said.

The commission also wants finance ministers to look at tighter anti-money laundering rules and is urging governments to push through measures against terror financing as soon as possible, according to the document.

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