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LuxLeaks

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Luxembourg Leaks (sometimes shortened to Lux Leaks or LuxLeaks) is the name of a collaborative journalistic investigation, based on a leak of tax rulings (tax agreements) negotiated on behalf of numerous multinational corporations by PricewaterhouseCoopers and the Luxembourg government. More than 340 companies worldwide used this method of tax avoidance through company-internal transactions, often ending up paying far less than 1% tax on corporate profits to Luxembourg, which would otherwise have been taxed at much higher rates in the countries were the actual economic activity occurred.

There have been no allegations that the deals were illegal under the law of Luxembourg, since the Luxembourg laws were tailored to make it legal. The tax rulings may, however, violate national laws outside Luxembourg. On the level of the E.U. the European commission started already earlier an examination in two cases: The tax rulings between the tax authorities of Luxemburg and Amazon and Fiat finance may be illegal subsidies (violate the EU rules on state aid). Some month prior to the leak Luxembourg refused to provide the EU with information about its tax rulings. The scale of the deals has been surprising to many.

It has been noted that the newly-installed President of the European Commission (at the time of the leak), Jean-Claude Juncker, is the very person who served as prime minister of Luxembourg during the time when many of the alleged deals were being set up. Shortly prior to the leaks, Juncker in a speech in Brussels in July 2014 promised to "try to put some morality, some ethics, into the European tax landscape". In November 2014 Juncker defended his actions referring to both the efforts on the automatic exchange of information (AEoI) (covered as part of the Common_Reporting_Standard) and the Common Consolidated Corporate Tax Base (CCCTB) (), as reported in an article in the Irish Times.

Most of the leaked tax rulings were negotiated and approved by a single civil servant, Mr. Marius Kohl.

List of companies named

This is the list of companies revealed as of 6 November 2014 to use Luxembourg for tax avoidance:

External links

References

  1. http://www.irishtimes.com/business/economy/luxembourg-leaks-controversy-a-game-changer-1.1992650
  2. ^ "Luxembourg tax files: how tiny state rubber-stamped tax avoidance on an industrial scale". The Guardian. Retrieved 12 November 2014.
  3. http://blogs.wsj.com/briefly/2014/11/06/luxembourgs-tax-deals-at-a-glance/
  4. European Commission, press release, State aid: Commission investigates transfer pricing arrangements on corporate taxation of Amazon in Luxembourg, 7 October 2014
  5. Global Policy Forum, Luxembourg Leaks: Secret Tax Deals of Multinationals Exposed, November 6, 2014
  6. "Carr, Wayne and Kelly (2014) ‘Lux Leaks’ Revelations Bring Swift Response Around World", November 6, 2014, International Consortium of Investigative Journalists
  7. "Mr Juncker yesterday underlined the Commission’s commitment to fighting tax evasion and avoidance, pledging to introduce automatic exchange of information rules for tax rulings offered by countries, and vowing to progress legislation on the controversial Common Consolidated Corporate Tax Base ." Lynch, Suzanne: "Juncker insists he acted within law on ‘Lux leaks’ agreements", Irish Times, 13 Nov. 2014
  8. Süddeutsche Zeitung, Ärger im Steuer-Märchenland, Süddeutsche Zeitung, 6 November 2014
  9. Norddeutscher Rundfunk, Deutsche Bank: Gewinne fließen um den Globus, 6 November 2014
  10. Business-Friendly Bureaucrat Helped Build Tax Haven in Luxembourg, Wall Street Journal, 21 Oktober 2014
  11. http://www.businessinsider.com/full-list-every-company-named-in-the-luxembourg-secret-tax-deal-database-2014-11


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