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European Parliament demands that member states stop blocking tax reforms

The European Parliament special committee on taxation (Tax 3) has voted on its final report which call for EU member states to match the intention of the European Parliament on tackling tax evasion, avoidance and money laundering.

Tax 3 voted for a permanent sub-committee on tax issues to be established in the next European parliament, following its disappointment with the lack of progress on the fight against tax avoidance and evasion by EU Member States.

The report criticised Member States and the Council for not delivering on tax legislation that is considered key to fight tax avoidance and tax evasion and their lack of political will to take substantial steps in the fight against money laundering, tax fraud, tax evasion and aggressive tax planning.

It also called on the European Commission to propose changes in the current EU law that would enable a ban on letterbox companies even if resident in EU Member States, for Member States to phase out all existing ‘golden visa’ schemes, and for better cooperation between Member States regarding the control of capital entering the EU from Russia.

Tax 3 committee member Molly Scott Cato said: “As a Parliament, we now agree that after so many tax scandals, the political scandal is that EU Member States have failed to take action on tax avoidance and evasion.

“Across Europe the social contract is broken and ensuring that the rich and powerful pay a fair share of tax is an essential building-block for a social contract fit for a globalised world economy and vital for rebuilding citizens’ trust in democracy. We need to build on this momentum in the Parliament and take the fight to the national capitals where we can truly change the rules around tax.”

The report will now be voted on by the whole European Parliament at the end of March.

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