European Union member states should stop hiding behind their bank secrecy rules and step up joint efforts to crack down on tax evaders, officials in Brussels said Monday.
The call came from Laszlo Kovacs, the EU commissioner in charge of taxation and customs, who wants national tax authorities to share more information about the savings held by EU citizens in different member states, reported dpa.
"In a globalized world, where tax evaders and fraudsters take advantage of the different limitations on national tax administrations, efficient cooperation and mutual assistance between tax administrations is essential," Kovacs said.
"In particular, it is unacceptable that bank secrecy in one member state can be allowed to constitute an obstacle to the correct assessment by the tax authorities of another member state of the amount of taxes due by one of its resident taxpayers," the commissioner said.
The commissioner's proposals target EU citizens who avoid paying taxes at home by stashing their savings in another EU country.
EU governments are already bound to share tax information.
But Austria, Belgium and Luxembourg have obtained exemptions allowing them instead to withhold taxes applied on interest earnings received by foreign residents.
One of the key elements of Kovacs' proposals is to stop such governments from invoking banking secrecy in order to refuse cross- border cooperation.
The proposals also set up common rules of procedure, forms, formats and channels for exchanging such information.
They also allow tax inspectors from one EU country to extend their probes into the territory of another member state and seek to improve cooperation in recovering unpaid taxes.
Tax fraud within the EU is estimated at between 200 and 250 billion euros (257-321 billion dollars) per year, or 2-2.5 per cent of the bloc's overall economy. This includes value-added tax fraud, which is not the subject of Monday's proposals.
The commission hopes to obtain unanimous approval for its proposals from the bloc's 27 governments by the end of the year. But experts warn that similar attempts to reform EU taxation rules have been mired in controversy.