(18 January 2018) Due to the recent developments in the area of taxation (including the OECD Base Erosion and Profit Shifting project and the European Union Anti-Tax Avoidance Package) the European Investment Bank has decided to undertake a review of its procedures and practices aimed at avoiding EIB Group operations being misused for tax fraud, tax evasion, tax avoidance, aggressive tax planning, money laundering and financing of terrorism purposes. This is why EPSU, together with other 13 organizations signed a joint paper to feed into the review of the Non-Compliant Jurisdictions (NCJ) Policy of the EIB.
In the paper, the coalition regrets the fact that no formal consultation has been opened by the EIB on the future Non-Compliant Jurisdiction (NCJ) policy. The revision of the strategies to counter tax havens is a crucial opportunity to strengthen the tools the EIB uses to ensure its operations do not fuel tax evasion and tax avoidance practices. Further to this, a number of key recommendations are proposed in the paper and in particular:
- The revised NCJ Policy review should lead to an ambitious outcome, ensuring strong policy coherence between the European Union efforts in fighting tax evasion and tax avoidance and setting in stone the EIB’s role as a leading international financial institution in the field of responsible taxation.
- Fundamental reforms to the existing NCJ Policy are necessary in order to address the serious structural flaws of this policy. The EIB, as the EU Bank, needs to act in coherence with its development mandate under the so-called External Lending Mandate and ensure investments in developing countries are bringing the due revenues to the local tax authorities.
- The revised NCJ Policy should reflect appropriately the numerous calls from the European Commission, the European Parliament and civil society to stop investing via structures based in tax havens.