Oxfam welcomes big victory against tax secrecy in Europe

Today, after five years of obstruction, Luxembourg and Austria agreed to increase the amount of information shared automatically by national tax authorities in Europe as of 2016.

Today’s adoption by EU leaders of the so called EU Savings Tax Directive follows last month’s G20 Finance Ministers’ decision to endorse a single global standard for the annual automatic exchange of information between tax authorities. The G20 proposal aims to better coordinate the crack-down on illicit financial flows. Poor countries are losing nearly $1 trillion a year to illicit capital flows – 7 times the volume of global overseas aid.

In reaction to today’s news, Natalia Alonso, Head of Oxfam’s EU Office, said:

“Today’s decision marks a major step in the fight against tax evasion. From now onwards, European governments will have in place a check on the €850 billion lost in tax evasion each year in the EU, which could pay for public services at home and in poor countries.”

“Europe can be proud in leading the move towards a more transparent financial system. Come September, when the G20 meets to discuss the bloc-wide implementation of shared tax information, the EU can enter negotiations with its head held high having set the bar for other developed nations.”

“The EU should use today’s move as a springboard and push for a global standard which also includes the developing world. While many poor countries are hard hit by tax dodging, they do not yet have the capacity to share tax data with others. Europe must start doing so unilaterally until poor countries have reliable tax administrations, something the EU must help them to develop. Only with a truly global and inclusive system to share information can the world pinpoint those individuals and companies harbouring money away from the world’s poorest.”

Notes to Editors

Read the European Commission’s Q&A on EU Savings Tax Directive.

In June last year, the European Commission proposed the revision of the EU Directive on Administrative Cooperation to extend the scope of automatic exchange of information to cover dividends, capital gains, any other financial income and account balances. EU governments are now expected to adopt the proposal this year.

G20 Finance Ministers, meeting in September in Australia, are expected to present details about the implementation of the single global standard for the annual automatic exchange of information between tax authorities which they endorsed last month.