During the plenary session (22-25/10/2018) of the European Parliament in Strasbourg, MEPs debate on Cum Ex Scandal. Statements by Karoline EDSTADLER, Austrian State Secretary in the Ministry of the Interior, Pierre MOSCOVICI, Member of the EC in charge of Economic and Financial Affairs, Taxation and Customs, Sven GIEGOLD (Greens/EFA, DE) and Dariusz ROSATI (EPP, PL).

Cum Ex Scandal; financial crime and the loopholes in the current legal framework: extracts from the debate

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SOUNDBITE (English), Karoline EDSTADLER, Austrian State Secretary in the Ministry of the Interior, Recent emerging media reports have referred to ongoing investigations in relation to the so-called cum-ex trades that reportedly involve tens of billions of euros. At this stage, it is our understanding that systematic investigations have been initiated and searches are being conducted at national levels in several Member States on suspicion of tax evasion.

SOUNDBITE (French), Pierre MOSCOVICI, Member of the EC in charge of Economic and Financial Affairs, Taxation and Customs, The Directive on administrative cooperation has been given a broader scope. The automatic exchange of information on transactions is now included for several instances. We know that information from some Member States are crucial for other Member States, for example on financial account, it is the end of Banking Secrecy, on the tax decisions made by some Member States, on information country by country, the tax ruling, on CBCR (Country By Country Reporting), all of that I think should be in the public domain. And then, exchange of information between national tax authorities and anti-money-laundering authorities.

SOUNDBITE (French), Pierre MOSCOVICI, Member of the EC in charge of Economic and Financial Affairs, Taxation and Customs, More recently, this directive has seen new provisions regarding the declarations of fiscal intermediaries, that the European Parliament voted in favour of and I would like to thank you for that, it will be in place next year, and will be a game changer as the intermediaries, bankers, lawyers, tax advisors, etc. they will all be compelled to declare the abusive or aggressive fiscal optimisation they propose to their clients.

SOUNDBITE (German), Sven GIEGOLD (Greens/EFA, DE), My colleague Mr. Furber made a point earlier on which I would fully subscribe to; we need to make sure that this automatic exchange of information is also extended to cover dividends. I think it's important for you Commissioner therefore to do both things.

SOUNDBITE (English), Dariusz ROSATI (EPP, PL), Germany already discovered in 2012 that there was a cum-ex scandal. They even started to arrest people but they didn't warn the other Member States that were on the list that they found among these fraudsters. They didn't warn Denmark, France and the other countries that they were the next in line. And now we have a bill of at least more than 50 billion euros stolen from the population. So what we need in EU is a 112 number, an emergency number you can call when you see fraud in your Member State and have authorities, tax authorities and police, working together in a coordinated fashion, assisting Member States in stopping these fraudsters once for all.

SOUNDBITE (French), Pierre MOSCOVICI, To be real, the fiscal sovereignty must be exercised jointly at the European level, otherwise we are left wide open against schemes that are often international. I know it is a difficult paradigm shift for everyone, starting with the Member States, particularly when it comes to taxes which they regard as one of the vital attribute of their sovereign powers. However, it is not a question of giving up that sovereignty; it is about exercising it together at a European level to work in the general interest of the EU and to decide on a collective approach which is the only one capable of giving a proper response to the great ingenuity of the fraudsters.

Cum Ex Scandal; financial crime and the loopholes in the current legal framework: extracts from the debate

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