The revelations that global and multinational businesses have been brokering “secret” tax deals with Luxembourg to avoid paying taxes in their home countries, may be the first time an entire country has been implicated in tax avoidance collusion.
A cache of leaked agreements uncovered by the International Consortium of Investigative Journalism (ICIJ) appears to show that major companies have used the tiny EU state to dramatically cut their tax liabilities.
6More
shared by Paul Merrell on 07 Nov 14
- No Cached
Luxembourg: a tax haven by any other name? | nsnbc international - 0 views
nsnbc.me/...luxembourg-tax-haven-name
tax-evasion Luxembourg DG-Competition EC PricewaterhouseCoopers
![](/images/link.gif)
-
The ICIJ’s six-month investigation claims to have found household companies such as Aviva, HSBC, E-on, Tyco, Pepsi, IKEA and Deutsche Bank were among those which had taken advantage of legal tax avoidance schemes in Luxembourg. Luxembourg is routinely named as a tax haven on many of the world’s authoritative lists of tax havens, including the one compiled by me and my two co-authors, Richard Murphy and Christian Chavagneux. But Luxembourg has managed to remain “under the radar” not least because its politicians and bankers have been denying for years that it is, or ever was, a tax haven. The revelations suggest Luxembourg has been playing a double game. Luxembourg has been quick to comply with new regulations proposed by the Organisation for Economic Co-operation and Development (OECD) and the EU. In 2011, the OECD global forum on transparency and exchange of information commended Luxembourg for introducing new rules governing banking information or information protected by secrecy rules.
-
But at the same time, the revelations show that 340 well-known foreign companies have entered into secret agreements with the Luxembourg authorities, brokered by the accounting firm PricewaterhouseCoopers. To take a random example that applies for many of these companies, the ICIJ have a letter to the Luxembourg tax administration written on a PwC letterhead, where FedEx lays down its plan to set up a limited liability company as a tax resident in Luxembourg – so subject in principle to Luxembourg’s corporate income tax. The letter then provides details of a proposed shareholding arrangement that will ensure, I quote, that “neither that Fedex SCS nor its shareholders will be subject to corporate income tax, Municipal Business Tax and Net Wealth tax in Luxembourg”. The letter implies that Luxembourg will serve in effect as a tax haven for Fedex.
- ...2 more annotations...
-
There have been a number of other highly publicised tax evasion and avoidance cases recently. For instance, many cases in the US involved branches or even key individuals working in branches of well-known Swiss and Israeli banks in the US, including UBS, Credit Swiss or Bank Leumi, or alternatively branches of American banks in Switzerland. But these tended to involve private firms. The Swiss government professed to have had no knowledge of such activities. Indeed, Swiss law prohibited Swiss banks, whether domestic or international, from providing any information on their clients to the Swiss state. This is a scandal with a difference. The leaked PricewaterhouseCoopers books imply there has been systemic collusion between companies from all over the world and the Luxembourg authorities in flagrant contravention of EU rules. The documents suggest that preferential tax treatments were guaranteed to these companies prior to their incorporation in Luxembourg.
-
This is the first case of suspected collusion between a government and a foreign firm in tax avoidance matters that I am aware of. In that sense, the current scandal places Luxembourg on par with Greece whose officials allegedly provided misleading data on Greek national debt to the Commission. More embarrassingly, all this took place during the time when the current president of the European Commission, Jean-Claude Juncker, served as the prime minister of Luxembourg from 1995-2013. It is difficult to imagine that the prime minister of such a small state was unaware such deals were taking place. There is a difference between the court of law and the court of public opinion. But we know from recent cases that the EU Commission has tended to follow the court of public opinion with criminal investigations of its own, as was the case of Amazon. It is likely that the Commission will now investigate these leaks and may impose fines on Luxembourg. I doubt Juncker can ride this one out.
-
Woo-hoo! The IRS and Congress will be interested in this one too. Now if someone would kindly send the docs to Wikileaks, the nations of the world can prosecute companies for tax evasion. But this time, would you all, pretty please, prosecute some human beings too and no settlements without at least a couple of years behind bars?
2More
Israeli Foreign Ministry: "Shocked" as Another Church Divests from Israeli Apartheid - ... - 0 views
-
Israeli Foreign Ministry officials have expressed surprise at the United Methodist Church’s decision to divest from five Israeli banks on the grounds of human rights concerns.
-
Bank Hapoalim, Bank Leumi, First International Bank of Israel, Israel Discount Bank and Bank Mizrahi-Tefahot are among 39 companies blacklisted by the UMC pension fund for failing to meet the guidelines of a human rights investment policy. An Israeli construction company, Shikun & Binui, was also excluded for its involvement in settlement building. According to Haaretz newspaper, the US decision is being taken seriously and is causing concern within the Foreign Ministry. It is being considered one of the most dangerous decisions made by a US institution to date regarding the imposition of sanctions on Israeli companies due to their activities in the West Bank. The newspaper quoted, according to Middle East Monitor/Al Ray, officials in the Israeli Foreign Ministry as saying that they are still studying the decision and its consequences. They also said that they will try to make contact with the head of the church in an attempt to push for a withdrawal of the decision or, at least, reduce its impact. The United Methodist Church is one of the largest Protestant denominations in the United States, with an estimated seven million members.
3More
shared by Paul Merrell on 28 Sep 17
- No Cached
UN takes first concrete step to hold Israel accountable for violating Palesti... - 0 views
mondoweiss.net/...ountable-violating-palestinian
war & peace Israel U.S.-foreign-policy U.N. BDS-victories
![](/images/link.gif)
-
September 27, 2017 — Today’s media reports revealed that the UN High Commissioner for Human Rights began sending letters two weeks ago to 150 companies in Israel and around the globe, warning them that they could be added to a database of complicit companies doing business in illegal Israeli settlements based in the occupied Palestinian West Bank, including East Jerusalem. The letters reminded these companies that their operations in and with illegal Israeli settlements are in violation of “international law and in opposition of UN resolutions.” They also requested that these companies respond with clarifications about such operations. According to senior Israeli officials, some of the companies have already responded to the UN High Commissioner for Human Rights by saying they won’t renew their contracts or sign new ones in Israel. “This could turn into a snowball,” worried an Israeli official. Of the 150 companies, some 30 are American firms, and a number are from nations including Germany, South Korea and Norway. The remaining half are Israeli companies, including pharmaceutical giant Teva, the national phone company Bezeq, bus company Egged, the national water company Mekorot, the county’s two biggest banks Hapoalim and Leumi, the large military and technology company Elbit Systems, Coca-Cola, Africa-Israel, IDB and Netafim. American companies that received letters include Caterpillar, Priceline.com, TripAdvisor and Airbnb. The Trump administration is reportedly trying to prevent the list’s publication.
-
Omar Barghouti, co-founder of the BDS movement, commented, After decades of Palestinian dispossession and Israeli military occupation and apartheid, the United Nations has taken its first concrete, practical step to secure accountability for ongoing Israeli violations of Palestinian human rights. Palestinians warmly welcome this step. We hope the UN Human Rights Council will stand firm and publish its full list of companies illegally operating in or with Israeli settlements on stolen Palestinian land, and will develop this list as called for by the UN Human Rights Council in March 2016. It may be too ambitious to expect this courageous UN accountability measure to effectively take Israel “off the pedestal,” as South African anti-apartheid leader Archbishop Desmond Tutu once called for. But if implemented properly, this UN database of companies that are complicit in some of Israel’s human rights violations may augur the beginning of the end of Israel’s criminal impunity.