Statement by the President of Socialist International, George A. Papandreou on the European Council’s decision about “tax heavens”
The European Council’s decision to request from the European Commission a continuation of negotiations with other countries, including “tax havens”, for the exchange of information on issues such as the taxation of bank deposits, is a move in the right direction. This adds to previous positive steps, such as the FATCA (Foreign Account Tax Compliance Act) adopted by the U.S. in 2010, and the OECD guidelines for an automatic exchange of information, which was also endorsed by the G20.
The crisis on both sides of the Atlantic has played a key role in these developments. However, until now the EU has not shown enough determination to move with the speed required to redress the impact of the austerity measures adopted to combat the crisis.
Although this EU decision is not forceful enough, it is among the few decisions taken during the crisis (together with the FTT – Financial Transaction Tax) that addresses social issues. Both these initiatives could have a positive impact on European citizens as they can contribute to restoring unfairness and inequality.
Any delay in the implementation of these decisions will hold back resources from national economies which could be spent on education, health, development and employment. Not only will it hinder the fight against tax evasion, but will leave citizens exposed to more unfair measures.
Since the beginning of the crisis,the Socialist International has repeatedly suggested a framework of proposals regarding the regulation and control of the world financial system and tax havens. These global initiatives are now bearing fruit.
However, these first positive results are not enough. There cannot be social justice without fairness in taxation.
I strongly hope that the initiatives from the EU and at an international level will speed up in order to combat tax evasion and control tax havens. This will benefit ordinary citizens. A strongly decisive message from the EU in this direction would also be the immediate conclusion of negotiations for the EU directive regarding the exchange of information about bank accounts within EU member states.