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EU leaders in drive against tax evasion at Brussels summit | EU leaders in drive against tax evasion at Brussels summit |
(about 2 hours later) | |
EU leaders say they are committed to tackling tax evasion and will push for global action to curb banking secrecy. | |
The president of the European Council, Herman Van Rompuy, said there was a "strong political will" in Europe to make tax systems fairer. | |
He said the EU would draft tougher rules this year on banking transparency. He was speaking after summit talks in Brussels. | |
A key goal is to prevent multinational firms exploiting legal loopholes. | |
There is widespread public anger that some big corporations have minimised their tax payments at a time of economic hardship. | |
Tax evasion and avoidance cost EU states 1tn euros ($1.3tn; £0.85tn) a year - more than was spent on healthcare in 2008. | |
The EU is now promising action against "aggressive tax planning" - that is, the complex yet legal accounting tricks used by some companies to minimise their tax payments. | |
EU leaders also want global standards on exchanging bank account data. The issue will be high on the agenda of a summit of the G8 industrialised nations in Northern Ireland next month. | |
'Real breakthrough' | |
Mr Van Rompuy said the economic crisis had injected new momentum into the debate on fair taxation. But he insisted that the EU was not seeking tax harmonisation across Europe. | |
"It's a real breakthrough... I am really convinced there is a strong political will by leaders not just on the European level, but on the global level, to tackle tax fraud," he told a news conference. | |
Germany's Chancellor Angela Merkel said that EU members Austria and Luxembourg - famous for their banking secrecy - agreed on the need for tax authorities to exchange information on private income. But "they attach great importance to also holding negotiations with third countries", she added. | |
Switzerland, outside the EU, is a major competitor in the market for rich bank clients. Austria and Luxembourg want to ensure that Switzerland and other low-tax jurisdictions in Europe, such as Monaco and Liechtenstein, do not have an unfair advantage. | |
Austrian Chancellor Werner Faymann on Wednesday joined the call for a crackdown on tax evasion. | |
A European Parliament resolution on tax evasion on Tuesday urged the EU to halve the 1tn-euro annual losses by 2020, by curbing tax loopholes and havens. | |
The MEPs also called for a joint EU blacklist of tax havens. | |
The European Commission is pressing for automatic exchanges of people's earnings data between tax authorities. | The European Commission is pressing for automatic exchanges of people's earnings data between tax authorities. |
Some experts argue that business tax planning also reduces the revenue that developing country governments can collect, for example by shifting declared profits to countries where they are lightly taxed. | Some experts argue that business tax planning also reduces the revenue that developing country governments can collect, for example by shifting declared profits to countries where they are lightly taxed. |
The BBC's economics correspondent Andrew Walker says politicians are keen to show voters that tax systems are fair, after a wave of unpopular budget cuts aimed at reducing deficits. | The BBC's economics correspondent Andrew Walker says politicians are keen to show voters that tax systems are fair, after a wave of unpopular budget cuts aimed at reducing deficits. |
Google, Starbucks and Amazon are among the companies that have faced tough questioning over their tax affairs recently. | |
And this week Apple came under fire in the US Congress over its low tax payments. | |
Energy co-operation | Energy co-operation |
The other main theme at the Brussels talks was energy policy - especially the need to improve Europe's energy infrastructure, develop renewables such as solar and wind power and remove barriers to competition. Much of Eastern Europe relies on Russia for gas - and in the past pricing disputes have led to supply shortages in mid-winter. | |
The Commission is urging EU governments to enact energy legislation that was agreed in 2011, warning that on current trends imports of gas will rise to 80% of the gas consumed in the EU by 2035. | The Commission is urging EU governments to enact energy legislation that was agreed in 2011, warning that on current trends imports of gas will rise to 80% of the gas consumed in the EU by 2035. |
The EU already imports 406bn euros' worth of oil, gas and coal annually - 3.2% of total EU economic output (GDP). | The EU already imports 406bn euros' worth of oil, gas and coal annually - 3.2% of total EU economic output (GDP). |
The fragmentation of Europe's energy market makes it difficult to woo long-term investors willing to commit to multi-billion-euro infrastructure projects. The energy mix varies greatly across Europe, from nuclear-dominated France to coal-dependent Poland. | The fragmentation of Europe's energy market makes it difficult to woo long-term investors willing to commit to multi-billion-euro infrastructure projects. The energy mix varies greatly across Europe, from nuclear-dominated France to coal-dependent Poland. |
But a key goal is to connect Europe's isolated "energy islands" - former Soviet bloc countries like Estonia and Bulgaria - to European grids and storage facilities. | But a key goal is to connect Europe's isolated "energy islands" - former Soviet bloc countries like Estonia and Bulgaria - to European grids and storage facilities. |
The distortions in Europe's energy market mean that Bulgarians - the EU's poorest citizens - pay more for their electricity than consumers in the UK or Germany. | The distortions in Europe's energy market mean that Bulgarians - the EU's poorest citizens - pay more for their electricity than consumers in the UK or Germany. |
In the global economy the energy blockages threaten to put Europe at a serious disadvantage. The gas price index for EU households rose by 45% in 2005-12, compared with 3% in the US, while the figures for electricity were 22% and 8% respectively, the Commission says. | In the global economy the energy blockages threaten to put Europe at a serious disadvantage. The gas price index for EU households rose by 45% in 2005-12, compared with 3% in the US, while the figures for electricity were 22% and 8% respectively, the Commission says. |