Proposition 51K2762

Proposition de résolution relative aux paradis fiscaux.

General information ¶

Authors

PS | SP Camille Dieu, Karine Lalieux
Vooruit Koen T'Sijen, Dirk Van der Maelen

Submission date

Nov. 22, 2006

Official page

Visit

Status

Adopted

Requirement

Simple

Subjects

OECD banking secrecy tax tax evasion tax avoidance corruption globalisation capital movement outflow of capital resolution of parliament developing countries money laundering

Voting ¶

Voted to adopt

Vooruit Ecolo LE PS | SP MR FN VB

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Discussion ¶

Feb. 1, 2007 | Plenary session (Chamber of representatives)

Full source

Before giving the floor to Mrs De Bue for her report, I would like to point out to the heads of groups and services that we will vote in about half an hour.

The resolution on tax havens was preceded by a discussion and several hearings of experts and representatives of civil society.

The participants also heard the presentation of Mr. Jamar, Secretary of State for the Fight against Tax Fraud. A debate was held on a range of topics such as Belgium’s role in the fight against tax fraud and the balance to be found between, on the one hand, the fight against financial transactions aimed at tax evasion and, on the other hand, the need to implement an attractive tax policy as part of a comprehensive economic policy.

Other discussions focused on existing or to be created structures for an effective fighting policy, on the different lists that exist to define tax havens and finally on the attitude to be adopted towards third-world countries.

Following this discussion, a series of amendments were submitted by the MR and VLD groups, in particular on the measures taken or to be taken by Belgium, on the creation or not of a specific structure, on the necessary European harmonisation and on the problem of developing countries.

These amendments resulted in compromise amendments voted unanimously.

Two points have, however, sparked more debate, namely the Preventive Double Taxation Convention and the exchange of information. The amendments were approved by five votes in favour and one abstention, in so far as, on the one hand, the failure to conclude a preventive agreement on double taxation was limited to countries considered as tax havens by the OECD and, on the other hand, the agreements on exchange of information with countries whose tax regime is significantly more favourable than in Belgium were extended.

The entire resolution, as amended, was approved by five votes for and one abstention.

Mr. Speaker, Mr. Deputy Prime Minister, colleagues, I will be very brief so that my good colleague, Mr. Van der Maelen, can discuss his resolution in detail.

In essence, this resolution calls on the federal government, first, to cooperate with all international and supranational initiatives against the so-called tax havens and in particular those practices of black money laundering or virtual transactions that are carried out with the sole aim of reducing the taxable base.

Second, I think that the evolution shows that we ask the government that our country engage in a general European policy in the face of tax havens.

Third, and not insignificant, we ask the government to help developing countries in particular, provide assistance and provide technical know-how to ⁇ better governance. On that point, I agree with Mr Van der Maelen that the government can generally better defend itself against the looting of own wealth by its own people with the cooperation of foreign companies.

The VLD faction has little trouble with this resolution. I would add to that in the face of colleagues with doubts that the resolution has evolved from a limited, almost ideological view of a problem raised. At the same time, we must recognize that we live in a globalized world, where, especially through technology, the movement of people, goods and capital can take place at a flash speed.

We believe that we have carried out this vast effort together in a good spirit. We have heard many specialists. We have submitted a report of almost 200 pages. In the end, we must therefore conclude that we have not been able to realize a sufficiently broad approach to this problem because it was not based on reality. We are an open economy. We have to live for a large portion of import and export. We did not actually pay attention to what is one of the most fundamental problems, in particular the fact that we encourage companies and individuals to evade taxes in a legal or less legal way. Socially, there is a feeling in this country that our tax burden is too high and that our tax systems are too complicated.

Mr. Speaker, this was for us an educational exercise with many interesting committee meetings. I had already pointed out the ambiguity as this was initially a joint activity of the Chamber and Senate. I think that the majority of our group can undoubtedly endorse this resolution and the questions it poses to the government. I will abstain with one or two colleagues at the vote because I believe that such a problem cannot be viewed from one aspect, even if it is the justified aspect of possible tax havens or paradise-like techniques it could be a different name.

I will speak personally, though with all my thanks and appreciation to my fellow rapporteur and all those who participated in the committee meetings and with whom we have been able to work together in the best of understanding for weeks.

I apologize for not having heard my colleague’s report.

The resolution that we are going to vote for now is in the air of time. It concerns the tax havens that, for some, remove from our beautiful country the Johnny Hallyday who can aim higher or, on the contrary, attract to us the medium-sized fortunes that cannot pay for the good Swiss air.

These easy jokes reveal a certainty: very wealthy people and, moreover, large multinational companies are closely studying states to identify those that will offer the greatest tax advantages. States are tax actors: they adopt a system, a set of rules that will or will not result in some attractiveness for investors and capital. A state must obviously play its best role as a tax actor to ensure the development of its economy, but it must do so with the double goal of joining a redistribution system to maintain well-being at home and cooperation, or even solidarity with other states.

We are here far from the reasons for being a tax paradise that, on the contrary, plays the "freeriders" in a market and globalized economy where technology has removed barriers, where large corporations are present in every corner of the world, where public power sometimes gives the impression, in economic matters, of suffering rather than acting.

The tax havens that facilitate and enable tax evasion and fraud are more or less well identified today, even though the lists made by one or another do not always overlap. In the face of the lack of profit for many states, in the face of criminal conduct of facilitating money laundering, a movement tends to counter the possibilities of enjoying these benefits by preventing certain assemblies, by signing bilateral, multilateral agreements, codes of good conduct, and I pass.

Alongside tax and judicial havens in the strict sense, there are also states that are “borderline”, which adopt preferential tax regimes to attract capital and investments on the back of other states.

These states, which exacerbate unfair competition, cost the community a lot, lose enormous incomes that should be reinvested in the general interest, and plunge some developing countries into even greater misery. The fight against tax evasion and tax evasion, favoured by these states, should be the social reason of a full-fledged international institution.

Belgium, which, for example, the absence of tax on large fortunes, sometimes makes it awkward in the eyes of those seeking to evade taxes at home, is, however, neither a tax paradise nor a “borderline” state, as I have called them. Instead, for several years, it has been engaged in the fight against tax havens and the practices they promote. But not enough, not proactively; a bit attentive.

The resolution demonstrates the ambition to push the government to adopt a dynamic policy to combat tax havens and unfair tax competition, both internationally and nationally.

This resolution is not a sequence of pious or utopian wishes. Its adoption, this afternoon, will obviously not turn these state-taxed robbers into cooperative states that fight against social dumping, but it will better counter a whole series of practices.

I will not explain the resolution here. By the way, my colleague Dirk Van der Maelen will probably do it in a much brighter way than I could do. I will only point out two very important points in my view.

In the short term – I think this is the great advance we will get today – the government will have to set up a special cell within the administration, which will be exclusively devoted to the fight against fraud and tax evasion through tax havens. The establishment of this cell is derived from the Irish OAG.

What should be its tasks? Identify and inventory the assemblies allowing fraud and tax evasion, develop effective measures to counter this tax evasion and set up systems to identify people who use tax havens for the purpose of fraud or tax evasion.

I insist on the fact that the creation of this cell exclusively intended for the fight against fraud and tax evasion through tax havens is not another bureaucratic structure, but rather a real instrument of struggle that has already proved itself. The financing of the conduct of advanced studies on this practice is very important; the better one knows the situation, the better one can lead the struggle.

I will conclude by recalling another important point of the resolution, namely the adoption by our country of FIF rules, CFC rules and reporting rules with regard to transactions of companies established in tax havens.

Even though I regret that we have to wait until half of the Member States of the European Union have done the same before this becomes a reality, I would like to emphasize that we are joining a voluntary approach and that we will quickly join states somewhat less frileous than us.

Mr. Speaker, Mr. Secretary of State, colleagues, with this resolution, we in the Committee on Globalization attempted to remove the backwardness that Belgium has in developing a policy regarding tax havens.

In Western developed countries, concerns about the impact of tax havens are growing, not only on the state treasury, but also on the economies of those countries. In the United States last summer, the Senate published a report calculating what the U.S. Treasury is missing in tax revenues as a result of the use of tax havens by U.S. companies. That amount is impressive. In the Senate report, there is a loss of income of $70 billion. That is an immense amount. It is equal to all the development aid given to developing countries in 2004 by the entire wealthy North.

The Tax Justice Network estimates, based on data from the Bank for International Settlements and McKinsey, that more than $11.500 billion of assets have found offshore shelter. That is about a third of the global GDP. I could also give figures on studies for France and Germany. I will not do that. Let me only state that, as far as Belgium is concerned, we have no figures. There are some indications. Why would Belgium be different from other countries? I think this country has a strong culture in terms of tax evasion. In Belgium it will be as bad as in other countries.

There are a number of indications that I think support this. Almost all banks operating in Belgium are present in different tax havens to have their – Belgian? Customers can offer a range of possibilities. Dexia is located in Jersey. Fortis MeesPierson is located in Guernsey, the island of Man and the Dutch Antilles. ING Private Banking is headquartered in Curaçao, Monaco and Singapore. KBC is headquartered in Monaco and Luxembourg. ABN AMRO Private Banking is located in Jersey, Gibraltar, Monaco and Curaçao. Van Lanschot Bankiers is located in Curaçao and Jersey. We know banks as private institutions that only do something when it yields, when the cost price is lower than the return they have. They must have a return. If those banks are there and stay there, that has a meaning.

Another illustration is the following. Since November 2005, the Flemish Airline has been flying from Antwerp to the island of Man. already two years. Even an airline does not maintain a losing airline if there is no sufficiently large occupation. However, on the island of Man there is not so much to see. There live 46,000 people. But it is true that there are bank accounts for a total of €46 billion in savings and there are also more than – listen carefully! 30,000 registered companies.

For those who are not yet convinced that there is something going on in this area in Belgium, I can say the following. In the third quarter of 2005, the loans granted by Belgian banks amounted to companies in Jersey – hold on! – 22.2 billion euros That’s more than loans to companies in any other country.

Finally, another indication. All major audit and consultancy firms and financial companies have seats in tax havens. Accenture and PWC Consulting even have their headquarters in Bermuda. Also Deloitte&Touch and KPMG have a division there to serve their customers. Ten days ago, the role played by KPMG in the Sabena file was revealed.

The conclusion is clear. Actions are being taken worldwide. Several countries alone, but also in collaboration with international organizations, are dealing with problems of tax use and abuse made of tax havens. They are developing a policy.

I am pleased to note that we have found a majority in this Chamber for the start of policy. I think we are at the beginning of a policy. We will work on it after the elections, but I hope we can take some steps before the elections.

What have we reached agreement on in the committee, and I hope later also in the plenary session? I will list four or five points.

First, ordering a study. It was high time. There are figures in the United States and in France. There is a better understanding of how actors use tax havens. I think Belgium should know this too. The resolution calls for such a study to be ordered. I would like to ask the Secretary of State to address the High Council for Finance as soon as possible to examine how the study for Belgium can be carried out. I would very much like that we do not entrust that study to a single person, organization or institution, for then we might one day go to confess to the devil. The relevant know-how is available in consulting, audit firms and other organizations. I think it is best to spread the study across as many bodies as possible so that we can have an internal checks and balances and we can find out everything.

Second, the resolution recommends that, once half of the other EU Member States have taken the step, Belgium also take the step to implement the OECD recommendations on national measures. These are CFC and FIF measures. Taking that step would be important because it allows us to look through the scenes and structures of tax havens. Once half of the EU member states have taken that step, the House recommends the government to take that step too.

A third key proposal in the resolution is to set up a specialised administrative unit, following the example of Ireland, to combat tax evasion and tax evasion through tax havens. The task of that cell would, first of all, be to map the constructions. It is already the case that here and there in the Ministry of Finance, at other bodies such as the money laundering cell or at the CDGEFID, information is available in various files about the involvement of Belgians in constructions through tax havens. In Ireland, it has been decided – and the proposal in the resolution goes in the same direction – to bring together all that information and knowledge and to have it analyzed by experts and specialists, such that one can discover certain patterns in those constructions through tax havens, even if for example it was only the involvement of always the same consulting company in a certain form of construction through tax havens. Only knowing who in Belgium is engaged in “selling” or forging that kind of structures, is already valuable information that allows detectives to start searching where we in Belgium see a trace.

The second task of the cell or unit is the development of a policy, a counter-policy. In several countries, including the United States and Germany, this is being done. It is not necessary for that unit to re-invent the hot water. It is sufficient to establish contacts with colleagues in other countries to see what kind of policy they are developing and to transfer it to Belgium. In Ireland, for example, techniques have been developed to look through the screens and go to the identity of the actual natural person who draws to the ropes of the moldy constructions that sometimes exist to screen that person.

The last recommendation concerns the following. The resolution recommends no longer concluding double tax treaties with tax havens, but rather accelerating the conclusion of information exchange treaties with tax havens.

As a result of an OECD policy, several of these tax havens have been pressured to transmit information on request from Member States under certain conditions. This requires an information exchange agreement as a basis. Several European countries are working hard on this. In our resolution, we recommend that our country do the same.

Finally, there are also a series of recommendations relating to developing countries. I was in the Committee on Globalization. Of course, we also have an eye for this. One of the key measures that we recommend in the resolution is that Belgium would take the task of helping those countries recover large amounts that have been placed, for example, by dictators such as Mobutu in tax havens and also in other countries.

So far, I have a first recommendation. This is the beginning of policy. I have asked the Minister to address the High Council for Finance on the matter.

Mr. Secretary of State, I would like to ask you to work as soon as possible on the installation of the special unit in the Ministry of Finance so that, in anticipation of further discussions, for example, in the coming government agreement, in the next government formation and also in the next legislature, we could have the study as soon as possible and so that we see a unit in operation that will go with us to analyze what all is happening. This will give us, as policymakers, the opportunity, with the information we will get from it, to take the necessary appropriate and urgent measures.

Mr. Speaker, I have listened very carefully to Mr. Van der Maelen.

First and foremost, the members of the Committee on Finance from my group regret, however, that the discussion on mainly a number of fiscal and financial matters was held only in the Committee on Globalization and not in the Committee on Finance. It would have added value if we could have discussed this issue in the Finance Committee as well. At the risk of being accused that our group is unwilling to engage in the fight against tax fraud and tax havens, which is not true at all, we would like to warn of a situation where we impose a number of rules on multinational or foreign companies which would make them find our country less attractive.

The struggle against the social and the struggle against tax fraud go hand in hand for us. Mr. Van der Maelen knows that. Among other things, colleague Daems has already alluded to this several times and has extended his hand for it. However, we ask that this should be done efficiently and we would not come into a situation where the medicine would be worse than the disease. We note that, according to Mr. Van der Maelen, a number of rules should be introduced in foreign-holded subsidiaries such as trusts or investment funds. At some point, there are so many transparency requirements for these subsidiaries that transfers from a Belgian company abroad would no longer be accepted by the Belgian tax authority. If you get into a situation where those foreign firms would leave the country, we believe that this will be at the expense of many jobs. In addition, a lot of additional tax revenues would be lost for the Belgian government. If one takes measures, one must make sure not to target all companies, thus also the good students of the class. That is our concern.

This government has been pursuing a successful policy for a long time – take the example of the coordination centers or the notional interest – to attract and keep headquarters of multinational corporations here.

A lot of business has also emerged around this service industry such as banks and insurance. Mr. Van der Maelen says that if banks stay somewhere, this means they can make profits. That seems quite logical to me.

I have some problems with the caricatural representation of things, as if a bank should not make a profit. Mr. Van der Maelen, I do not deny that you are right in some matters. I said from the beginning that we want to fight this fight. However, there is quite often an image of a sector that makes profits in an unauthorized way.

We recently had a study that showed the following. If the Belgian banking sector could have grown in the last twenty years in the same way as the rest of the companies in our country, this sector would have had much more jobs. Thus, thousands, or tens of thousands of jobs have been lost in the banking sector because that sector has not grown sufficiently in the last twenty years and has not been able to generate sufficient returns.

That is the reality. Does this mean that the banks do not make a profit? No, but for us, making profit is not a pernicious thing in itself. In this regard, we often differ in opinion with your party, Mr. Van der Maelen. Making profit in itself is not corrupt for us.

Therefore, a number of colleagues from my group will abstain. We will not vote against, but we will abstain. After all, we find that that resolution contains a number of elements that we believe the child is thrown away with the bath water. We also regret that this discussion was not conducted in a specialized committee such as the Committee on Finance.

Mr. Speaker, I would like to bring one or the other element, without being too long because there was the report and the interventions of the various colleagues.

I would like to highlight the fact that this resolution is the result of the work carried out at several meetings and that, ultimately, it brings together the points of view. The original text, in its motivations and in its considerations, seemed to us, Mr. Van der Maelen knows it, sometimes somewhat rude, sometimes somewhat caricatural, sometimes somewhat unnecessarily "provocator", even though I understand the philosophy underlying what is asked today. In the requests that were made, there were many very interesting and very important things; there were things that were of no use, to the extent that if they were pleasant to hear, they were inoperable on the ground, so that after one or two meetings, which I would call constructive, the cabinet and the authors of the proposal collaborated to result in a text, which has all the merit of existing.

I agree, on the one hand, with the point of view developed by Ms. Lalieux and Mr. Van der Maelen and, on the other hand, I hear the point of view developed by Mr. Tommelin today and by mr. Cortois in committee. I think these two points of view are not antinomial. We are almost at the end of the legislature and it will be up to the next government, whatever it is, to make these recommendations what it wants.

I will only take a simple example in this assembly.

We find here the ISI (Special Inspection of Taxes), the CAF (The Anti-Fraud Committee), the CTIF (The Financial Information Processing Cell), especially in the context of laundering – we have talked a lot about it in the framework of the DLU –, the OCDEFO (The Economic Police Body) that works in the same way as the others, the “Transfer Pricing”, which works on transfer prices to counter companies that aim to play abnormally and illegally on different prices between sister companies of the same multinational and thus take advantage of the system of globalization. Considering these five bodies, without citing the AFER or without citing other subgroups of the big tax house, it may be wise to realize, like Ireland, that with more coordination and collaboration – even if it is already done very well – it would be more effective to create only one globalised unit, taking into account what exists, to be more operational.

The main problem is the definition of tax havens. At the GAFI (International Financial Action Group), you are talking about one thing: cooperating countries and those who are not. There are only five or six countries left to resist – islands mostly and unknown to most, such as the Caiman Islands, other islands in the Pacific, but also Nigeria or Ukraine. In addition, all other countries are considered to be cooperating countries on the fiscal level.

The OECD considers that 38 countries apply a tax regime that is far too advantageous compared to others, and Belgium considers that there are 51. You see all the difficulty for Belgium to adopt an objective attitude towards such a country that proposes to invest in us or any other that is not considered dangerous by the OECD and even less by the FATF which fights primarily against terrorism, laundering and large-scale operations and which therefore tends to bring together goodwill countries in this regard.

In June 2005, when I was in Singapore, Belgium was the first and so far the only country to meet the 40 recommendations on anti-laundering and anti-terrorism. Our bulletin had the mention "very well", the only two comments made against us were on the fight against money smugglers - arrangements are made, the Parliament is seized and in June, we will no longer be able to leave Belgium with more than 10,000 euros unless the declaration is made - and on the freezing of assets of persons suspected of illegal activities.

Belgium has taken its provisions, either by legal or regulatory means. It will be completed by the end of the legislature. I invite parliamentarians to read the requests to the government: then it is difficult to disagree with the underlying philosophy of fighting tax fraud.

Finally, according to figures from the European Commission and the McKinsey report, Belgium is unfortunately ranked third in tax fraud, after Italy and Greece. According to the European Commission, 10 to 15 percent of GDP is fraud; the McKinsey report even reports 22 percent. If the tax product of this underground economy could reappear, many of the topics we often talk about, such as ageing or health, would find solutions much easier.

Therefore, it is our duty to find this right compromise. For me, this resolution constitutes a good compromise and I invite you to make it right. This work was carried out in collaboration between your proposal and our strategic cell. I have ⁇ this to the government.

I know that certain terms can sometimes strike. I abstained from the considerations and motivations to stop at the pragmatic character and what this motion demanded. It will be up to me first and then the next government to take this into account as much as possible.