12/06/20

INTERNATIONAL TAX: EU Parliament Plans Permanent Subcommittee On Tax Avoidance.

As published on law360.com/tax-authority, Thursday 11 June, 2020.

The European Parliament voted Thursday to establish a permanent subcommittee on tax avoidance, evasion and transparency following demands from left-leaning blocs in the legislature.

The new committee would pick up where two temporary special committees, known as TAXE and PANA, left off after being established in response to major tax-evasion scandals such as the Panama Papers, a leaked cache of documents from the former Panamanian law firm Mossack Fonseca that revealed widespread use of offshore shell companies to avoid tax. However, unlike their predecessors, the new committee will not address the issue of money laundering, as the motion approved by the Parliament makes no mention of that aspect.

The vote total was unavailable.

The committee will have 30 members and is expected to be chaired by Paul Tang, a Dutch socialist member of the European Parliament. The election of the members will take place in September.

Sven Giegold, a German member of the European Parliament, called the move a "big step" in the fight against tax evasion in Europe and an important success for tax justice advocates.

"If the public sector spends an unprecedented amount of money today, it must also think about tomorrow's revenues," Giegold said.

Echoing Giegold, Chiara Putaturo, European Union tax policy adviser at the global development charity Oxfam, told Law360 that establishing the committee represents an opportunity to "look more deeply" into specific problems and consider what changes are necessary to tackle them.

"It comes in the right moment because closing the tax loopholes is extremely important for recovering from the crisis and solving global imbalances," Putaturo said.