Reuters: Regulatory News: Luxembourg seeks to overcome tax haven stigma

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Luxembourg seeks to overcome tax haven stigma Apr 30th 2013, 14:31 Tue Apr 30, 2013 10:31am EDT * Finance minister says fighting tax evasion top of agenda * EU Commission welcomes further steps on transparency BRUSSELS, April 30 (Reuters) - Luxembourg is willing to discuss international moves to stop big companies using cross-border tactics to reduce tax, its finance minister said, part of a bid to show its growing transparency after moving to end bank secrecy. As European countries try to increase revenues to rein in heavy debts, the impetus to challenge tax havens as well as end company schemes structured to cut tax bills is growing. Luxembourg said this month it would lift bank secrecy rules for EU citizens with savings there. On Tuesday, Finance Minister Luc Frieden also responded to criticism of schemes used to reduce corporate tax, saying the fight against tax evasion was top of the agenda and Luxembourg was willing to contribute to discussions about so-called tax-base erosion, or the avoidance tactics companies use. "Whereas current tax structures are fully in line with international standards the move from double taxation to double non-taxation is, of course, of serious concern," he said. Companies used to risk paying tax twice on cross-border deals, but more recently, groups such as Amazon, Apple , Microsoft and Google have been able to capitalise on varying international rules to reduce taxes on profits. The groups say they abide by tax regulations in all the markets in which they operate. Amazon minimises tax by channelling most of its European profits through a tax-exempt entity in Luxembourg. The European Commission welcomed Frieden's comments. "The statements we've seen from Luxembourg to go even further in transparency and information exchange are very welcome," said a spokeswoman for Algirdas Semeta, the EU commissioner in charge of tax policy. Tax evasion and fraud are on the agenda for a summit meeting of EU leaders on May 22. Link this Share this Digg this Email Reprints

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