Leaked diplomatic cables indicate that Jean-Claude Juncker, the embattled president of the European Commission, blocked proposals to clamp down on cross-border tax avoidance schemes within the European Union (EU) as prime minister of Luxembourg.
Shared with The International Consortium of Investigative Journalists (ICIJ) and The Guardian newspaper by German radio group NDR, the cables suggest that Juncker fought a determined campaign against anti-avoidance proposals as a member of the EU’s secretive Code of Conduct Group on Business Taxation.
Juncker had a firm hand on Luxembourg’s finances and tax regime for almost two decades. He governed as prime minister in the Grand Duchy from 1995 to 2009, having previously served as minister for finances from 1989 to 1995 under Jaques Santer, a controversial politician who went on to head a European Commission administration which resigned in disgrace after a key member was charged with fraud, forgery, and abuse of confidence.
The leaks follow the previous ‘LuxLeaks’ controversy, which revealed how the Grand Duchy “rubber-stamped tax avoidance on an industrial scale” during Juncker’s premiership, arranging hundreds of “sweetheart deals” with multi-nationals through PricewaterhouseCoopers (PwC).
The European Commission released a blacklist of international tax havens shortly the LuxLeaks revelations, but while it included countries such as Niue, a tiny statelet in the South Pacific with a GDP estimated at just $10 million (£8 million), President Juncker’s home state was conspicuously absent.
Nigel Farage, who led the Brexit campaign, and Beppe Grillo, who leads Italy’s anti-establishment Five Star Movement (M5S), attempted to have the Commission president censured for his role in the scandal by the European Parliament, but the motion was heavily defeated by his political allies despite the support of Marine Le Pen and the French nationalists.
The whistleblowers who exposed the deals, meanwhile, were arrested, charged, and convicted in a trial condemned as “a disgrace” by transparency campaigners, and the ICIJ claims Luxembourg has inked 172 new deals despite the scandal.
Breitbart London recently reported how the rules of the EU’s Single Market could be allowing corporations which argued against Brexit during the EU referendum to deprive the UK of up to £10 billion in taxes, with the Global Britain think tank arguing that this underscores the need for a “Clean Brexit” from the bloc.