I am grateful to Carol Wilcox who wrote to her Conservative MEP to ask why he had voted against the resolution in the EU parliament that requested that the EU Commission take action to stop tax abuse and then shared his story with me, which is as follows:
Dear Ms Wilcox,
Thank you for your email. Conservative MEPs, and myself, voted to reject this report, drafted by a British Labour MEP, because it calls for more powers for the European Commission over tax policies.
The report calls for the introduction of a Common Consolidated Corporate Tax Base, a European definition of tax havens, and mandatory notification of all new tax measures by national governments to the European Commission.
It is part of the European Parliament’s response to the “LuxLeaks” revelations over allegations of tax avoidance. I fully support the fight
against aggressive tax avoidance, but the proper fora for cooperation on fighting against tax fraud and other harmful tax measures are the OECD and the G20. The EU should rigorously follow the work done on the OECD level.
In my opinion this was yet another attempt by Labour MEPs to hand over powers on the setting of tax policies to Brussels bureaucrats.
I believe that this report completely oversteps the mark with regards to tax harmonisation. Tax policies are a matter for national governments, and Conservative MEPs will fight to keep it that way. I contend that instead of coming up with its own ideas, the EU should be rigorously following the ongoing work already done by the OECD and the G20.
There is so much in here that is wrong it makes me want to weep with frustration.
Yes, it is true that a Labour MEP was involved with the drafting of this report, but so were other MEPs, and surely the issue is more important than a petty party squabble? For the record, Greens, Socialists, Liberals and Christian Democrats all managed to agree on it. They put the issue before party. Why couldn't the Conservatives?
And yes, the plan does call for more powers for Europe, but a common market does require a common tax base. That is economically obvious, I would have thought. Or is it that the Conservative MEPs are now anti-EU come what may? In which case shouldn't we know that?
And surely Ashley Fox knows that the OECD recommendations on tax abuse have to be implemented? They are by themselves nothing more than recommendations. It is local legislation that gives them life. The EU has long been a successful agent in this process. The European Union Savings Tax Directive and EU Code of Conduct on Business Taxation are testament to that and both have worked well. It is nonsense to suggest otherwise now.
So this is an exercise in pettiness to obstruct real progress on ending tax abuse in the UK, Ireland, Luxembourg and elsewhere. It is deeply disappointing to see just how opposed some UK politicians appear to be to that process.