Thursday, November 12, 2009

Liechtenstein exits OECD list

Liechtenstein has passed into the OECD's whitewash, sorry, white list category.

Liechtenstein scored an 87 percent opacity score on our Mapping the Faultlines project. It sauntered over the OECD hurdle simply by signing two more utterly inadequate OECD-styled agreements.

It is a sad day that this is what passes for being considered acceptable. Shame on the OECD, for legitimising the illegitimate.


Anonymous Anonymous said...

Luxembourg scored 87% opacity and was congratulated by Angel Gurria in an OECD press release dated 8 July 2009: “I commend Luxembourg for its swift implementation of the OECD standards on exchange of information. In three months, Luxembourg has turned into reality its commitment to fully cooperate in tax matters. I would like to congratulate Minister Luc Frieden for his leadership in this process”.

It is amazing to see how agreements are about to be enforced in the Luxembourg law (draft law N°6072).
Luxembourg has imagined the "discharging fine" to keep secrecy:

The text states that the Luxembourg tax administration :
- will examine the requests from foreign tax administration to assess if they comply with the law and the agreement, and if so
- will request officially (registered letter) the data from the entity.
Should the entity not provide the data within one month, it would be fined up to EUR 250,000 by the Luxembourg tax administration, on the director's discretion.

1. A fine is not coercive: why not introduce a criminal liability for not providing data and authorise an investigation to look for the data?

2. This amount of EUR 250 000 is ridiculous when one knows the amounts of tax evasion and anyway is a maximum that will never be fined (See administrative fines by CSSF).

Above all, this fine is actually a way to bypass the agreements based on the OECD tax model. Luxembourg bankers are very creative. One can imagine a new service for clients that would be charged a fixed price of EUR 250,000 for the bank to keep secrecy ; and I do not think a new request from foreign tax administration on the same data will be accepted.

Banks would make money and the Luxembourg government would make money as well.

Time is up for OECD to smell the coffee.

Jérôme Turquey

9:53 am  

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