Just after the second wave of the revelations, which confirmed the scale of the system put in place by Luxembourg to attract multinationals almost not making them pay taxes, the former Prime Minister of the Grand Duchy (between 1995 and 2013), now president of the European Commission, faces new embarrassing information.
In an interview with Luxembourg newspaper Letzebuerger Land dated by a day in August, resumed in recent days by the British media, Bob Comfort, former head tax Amazon, that says Juncker was involved in negotiations with multinationals. When it came to negotiate the establishment of the American giant of online business, Mr Comfort explains: “Our team dealt especially with the Director General of the Ministry of Finance, Gaston Reinesch, and Jean-Paul Zens, director the media services (…). We also met the Prime Minister once or twice. His message was: “If you encounter a problem you think you cannot solve, get back to me. I will try to help you.”
These statements may reinforce the idea that, unlike some of his assertions, former Prime Minister of Luxembourg followed closely or facilitated agreements with multinational, but they do not surprise the good connoisseurs of the country. Mr Juncker has never hidden his ambition to promote the maintenance of the insolent prosperity of his country. While its steel industry collapsed, the Grand Duchy wanted to develop other activities, logistics, broadcasting, but especially its financial center.
Strong political support
In a recent interview with Liberation, Mr Juncker said he was part of “weakened” by LuxLeaks, but it still has strong political support. In Parliament, the Conservatives and the Social Democrats argue, and it is not disputed by the Liberals. The Greens have tried to push for the opening of an inquiry but did not have the sufficient number of signatures. And they say they prefer a president who, under duress, could launch reforms rather than open crisis which would strengthen the camp of Eurosceptics.
In European capitals, no one dared to throw stones. “We consider that this is unfair: Luxembourg is far from being the only one to allow multinationals to pay very little tax. The Netherlands, the United Kingdom, Ireland are also known for it,” says a senior EU source.
Mr Juncker is not threatened, provided that his promise to fight against the abuse of evasion and tax fraud is kept. He asked the Commissioner Pierre Moscovici prepares a directive on the automatic and mandatory exchange of “rulings” (agreements between groups and taxing authorities), and advance another text to harmonize the tax base of companies.
Furthermore, the prosecution of Luxembourg announced that the alleged author of the flight of tens of thousands of pages of tax agreements that triggered the LuxLeaks scandal was summoned and charged with theft and money laundering. His identity was not revealed. But it is said that he is a French, a former employee of the auditing firm PwC Luxembourg, according to the newspaper Luxemburger Wort. The person who lives in France was summoned as part of a commission of the Luxembourg court, heard by the judge for a few hours and charged before being released, the newspaper said.
The person who helped the revelations of the case “LuxLeaks” on tax evasion Luxembourg, making fuiter thousands of pages of tax agreements between multinational and country, was charged with “domestic flight, violation of professional secrecy, violation of trade secrets, money laundering and fraudulent access to an automated data processing system,” confirmed prosecutors of Luxembourg on Friday, December 12.
The indictment of the accused, whose identity was not disclosed, follows a complaint against X that the audit firm PWC-Luxembourg had filed in June 2012, after discovering the theft of documents during a France 2 television report, a month earlier.
This report devoted to tax evasion in the Grand Duchy revealed the existence of hundreds of tax agreements between the administration of direct contributions Luxembourg and the subsidiaries of multinationals, allowing the latter to pay almost no taxes.
According to the leaders of PWC-Luxembourg, the theft was committed in September 2010 by a former employee of the firm, who had been copying confidential data without being spotted, for nearly two years.
After the complaint, a judicial inquiry was opened by the prosecutor of Luxembourg. The investigation was relaunched in November after LuxLeaks revelations by the consortium of investigative journalists ICIJ. The revelations relate to tax agreements between Luxembourg and 340 multinationals, including Apple, Amazon, Ikea, Pepsi, Heinz, Verizon and AIG, to minimize their taxes. On Tuesday, on the eve of the swearing in of the new President of the European Commission, Jean-Claude Juncker, new information particular to Skype groups, Walt Disney and Koch Industries were broadcast.
Juncker was Prime Minister of Luxembourg where such agreements were signed by the Grand Duchy of tax administration. He keeps promising to strengthen the fight against tax evasion and tax fraud, and again said this week that “tax harmonization” was an “absolute necessity”, not to be “subject to will alone groups who are trying to escape tax.”