EU parliament to investigate tax dodges but rejects full inquiry
By Alastair Macdonald
BRUSSELS (Reuters) - European Union lawmakers agreed on Thursday to set up a committee to look into tax avoidance across the bloc but refused to launch a formal inquiry that many members had insisted on after leaked documents exposed tax dodging in Luxembourg.
Following the publication in November of "Luxleaks", Greens in the European Parliament collected signatures from the 25 percent of lawmakers needed to demand a committee of inquiry with broad powers that could have put pressure on Jean-Claude Juncker, the long-time prime minister of Luxembourg, who became the EU's chief executive three months ago.
Sven Giegold, the Greens economic spokesman who helped draft the proposal for a full inquiry, called the special committee a "cop-out". "The parliament's ruling cabal," he said, "simply does not want a proper inquiry."
But leaders of the bigger parties, including Juncker's own centre-right bloc, said parliament's legal experts had advised against such an inquiry, partly as it might conflict with legal investigations into tax avoidance launched by the European Commission in Luxembourg, Ireland, Belgium and the Netherlands.
Instead, parliament will set up a committee to report on tax fairness across the EU with a view to framing legislation.
Voters are concerned that some large corporations have paid little tax by taking advantage of schemes in which EU states divert revenues from their neighbours by offering low tax rates in return for cash being channelled through their jurisdiction.
Juncker has now called for efforts to coordinate tax rates across the EU, though many powerful governments, notably in Britain, oppose giving up national powers to set taxes.
In late November, Juncker comfortably survived a no-confidence vote in parliament brought by Eurosceptic parties which accused him of being unfit to run the Commission due to his previous role overseeing Luxembourg's taxation system.
The tax arrangements of Amazon and Fiat in Luxembourg, Apple in Ireland and Starbucks in the Netherlands are under investigation by the European Commission's anti-trust authority.
(Editing by Louise Ireland)
