The EU executive has announced a further clampdown on offshore tax avoidance and shell companies in response to the Panama Papers.

The European commission wants tax authorities to be able to identify the real owners of offshore funds in an attempt to stop individuals and companies avoiding tax by hiding money and assets in opaque companies and offshore trusts.

The EU executive has also promised a robust new law to clamp down on lawyers and tax advisers helping clients stash money in offshore islands, although details remain sketchy.

The EU recently agreed measures to compel big companies to disclose their earnings and tax bills after a public outcry about multinationals using legal loopholes to lower their taxes.

But following the leak of 11.5m files exposing the tax secrets of the global elite, EU officials extended their focus to tax havens.

“The recent leaks exposed loopholes that still allow tax evaders to hide funds offshore,” said Pierre Moscovici, the European commissioner in charge of tax policy, as he announced the plans on Tuesday. “These loopholes must be closed and our measures to stamp out tax abuse must be intensified.”

In future, national tax authorities will exchange information about individuals and companies behind a trust, which is already collected under EU anti-money laundering rules.

As well as strengthening transparency, the commission has promised to clamp down on lawyers and tax advisers who come up with elaborate tax avoidance schemes.

The French tax commissioner promised to publish “robust EU rules to hold tax advisers to account” before his mandate ends in 2019, with a public consultation to start “as soon as possible”. Existing international rules on tax advisers were rather unspecific, Moscovici said, adding that he hoped that EU law would be “an inspiration to our international partners”.

The plans are part of a broader package of measures to stop money laundering and terrorist financing. Other measures would give authorities more oversight over Bitcoin and equivalents in a bid to stop virtual currencies being used by terrorists and criminals.

Judith Sargentini, a Dutch Green member of the European parliament, welcomed the fact that the commission was “grasping the nettle and trying to strengthen EU anti-money laundering rules in response to the Panama Papers revelations”.

She said: “The commission has set out a number of crucial measures but the proposals lack the necessary enforcement measures to make sure the rules are implemented and have a deterrent effect.” The Panama Papers showed that “existing rules are being widely flouted … this shortcoming must be addressed”.



The MEP, who will be one of the parliament’s lead negotiators in redrafting the EU’s anti-money laundering law, called on the commission to publish a law targeted at professionals “facilitating tax dodging” as soon as possible.

Transparency campaigners gave the proposals a mixed review. “We’re pleased to see the commission recognises that transparency is vital to end the system of secrecy which helps allow the corrupt to hide their stolen cash,” said Laure Brillaud, at Transparency International’s EU office.

But the campaign group said major loopholes remained, because registration requirements will only apply to trustees based in EU member states.

“Once again the commission has stopped short of full transparency around trusts,” said Brillaud. “This is a bold step by the commission but it’s not the brave leap needed to end this system of secrecy which fuels impunity.”

