Hollande Creates a French Prosecutor for Fraud and Vows to End Tax Havens - NYTimes.com - 0 views
www.nytimes.com/...hen-stance-on-tax-evasion.html
tax haven france fraud luxembourg austria europe financial
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President François Hollande on Wednesday announced the creation of a position of special prosecutor to pursue cases of corruption and tax fraud, and vowed to eradicate tax havens “in Europe and the world.”
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one of those tax havens, Luxembourg, announced that it would bow to pressure from its European allies and begin forwarding the details of its foreign clients’ accounts to their home governments. Luxembourg, with only half a million people and a banking sector more than 20 times the size of its gross domestic product, is one of Europe’s largest financial centers and has been compared to Cyprus
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Luxembourg’s announcement came a day after five of the biggest European countries — Britain, France, Germany, Italy and Spain — agreed to exchange banking data and create their own automatic tax data exchange. That mechanism would be modeled on the Foreign Account Tax Compliance Act, passed by Congress in 2010 to track the overseas assets of Americans who might be dodging taxes.
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they urged the European Union commissioner responsible for taxation, Algirdas Semeta, to work to get all 27 members of the European Union to sign up.
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Mr. Cahuzac was fired and expelled from the party, but that the minister in charge of fighting tax fraud had committed it himself has been deeply damaging.
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The journalist consortium, a project of the Center for Public Integrity, disclosed confidential information on more than 120,000 offshore companies and trusts and nearly 130,000 individuals and agents, including 4,000 Americans. But the consortium has refused requests by governments for access to the files, saying that it is not an arm of law enforcement.
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In addition to creating the prosecutor position, he ordered cabinet ministers to disclose their finances and asked legislators to do the same. He also promised to create an independent authority to monitor the assets and possible conflicts of interest of senior officials and legislators.
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the Washington-based International Consortium of Investigative Journalists announced that it had obtained confidential information relating to tens of thousands of offshore bank accounts and shell companies. The leaked data, which centered on the Caribbean and especially the British Virgin Islands and the Cayman Islands, embarrassed European governments, including Luxembourg, by showing how wealthy citizens routinely hide assets, sometimes illegally, and avoid paying taxes by setting up offshore companies.
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France’s resilience to external shocks is “diminishing” and its medium-term growth prospects are “increasingly hampered by long-standing imbalances,” the report said, noting that France’s share of European Union exports declined by 11.2 percent from 2006 to 2011, while rising labor costs have damaged competitiveness.
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The move by Luxembourg toward disclosure leaves Austria as the lone holdout in the European Union. It pays a 35 percent withholding tax on the interest income of accounts held by foreigners in Austrian banks to their country of residence, but refuses to disclose the account holders’ identities.