Banking


Lax In Luxembourg

Posted on May 4th, by Global Tax Weekly in Banking, International Taxation, Tobin Tax. No Comments

So the European Court of Justice, supposedly the guardian of the sacred freedoms of the European Union, has chickened out of one of most important issues currently confronting the EU, at exactly the moment when it should have taken centre stage and erected or reaffirmed some principles for the Union to follow.

In recusing itself from any involvement in the structural legislative processes of the Union over the question of the Financial Transactions Tax, the Court has diminished itself and the Union, sending a message that administrative convenience is a more important principle than judicial rectitude. It will be many a long day before it recovers from this piece of egregious cowardice, if it ever does.

There are multiple theories to explain the court’s behaviour (I hereby deprive it of its capital letter – it no longer deserves it), but the most … Read More »


Broken Europe

Posted on April 27th, by Global Tax Weekly in Banking, Budgets, IMF, Individual Taxation. No Comments

A fall in average deficits in the Eurozone and the European Union in 2013 sounds like good news, but lift the hood and the picture is not so pretty. Total debt in the Eurozone (17 countries) increased to 92.6 percent of gross domestic product from 90.7 percent in 2012, ever further above the European Union’s Maastricht limit of 60 percent. For the whole EU, debt increased from 85.2 percent of GDP to 87.1 percent. Obviously these figures reflect a mismatch between income and expenditure. It’s not however the case that public expenditure increased everywhere: although in France public spending reached a record 57.1 percent of GDP, overall EU public spending fell marginally to just less than 50 percent. Alongside increases in debt, the falls in deficits merely testify to a concomitant increase in tax revenues which ate into the gap … Read More »


Malta In The Crosshairs

Posted on March 9th, by Global Tax Weekly in Banking, Budgets, Corporation Tax, E-commerce, Individual Taxation, OECD, Offshore. No Comments

As usual during this period of fiscal stress for countries across the world, we look in vain for any cuts in taxes. But at least in Malta they are trying to improve matters for businesses through simplification of the tax system and throttling back the impositions of government. As I say that, I can already hear the offended wailings of the anti-brigade: oh, but Malta is offshore, it is a tax haven, it steals revenue from big “respectable” countries like Germany by helping banks and gaming companies with low tax rates, so that they can’t get the revenue to help their poor, huddled masses to survive the rigors of the nuclear winter we are all trying to survive. Let’s be clear: the “nuclear winter” is a direct result of the debts taken on by those countries’ politicians in pursuit of … Read More »


Iffy On The Liffey

Posted on February 26th, by Global Tax Weekly in Banking, Budgets. No Comments

So far as our news service is aware, no country is planning to reduce taxes this week, but at least in Ireland they are talking about doing so. The Deputy Prime Minister said as much; and a few days earlier the Finance Minister had said the same. They need to, heaven knows, and they have the right ideas, but I have to wonder where they are going to find the dosh. The budget deficit was 7.5 percent in 2013, and will be 4.8 percent in 2014, according to Government estimates, although external commentators think that is optimistic. Ireland’s debt was 25 percent of GDP in 2008, before it started on the suicidal “rescue” of its banks; now the debt stands at 125 percent of GDP, and may rise further. It’s hard to make out whether the Government is actually cutting … Read More »


The Magic Disappearing Tax

Posted on February 23rd, by Global Tax Weekly in Banking, Individual Taxation, International Taxation. No Comments

Italy in the spotlight again this week, with (unelected) Matteo Renzi in full flood of (unelected) government-forming. It’s difficult to see how he can change the Porcellum (pig-sty) for the better with the dogs’ dinner of a parliament that he has inherited from his unsuccessful predecessors, Mario Monti and Enrico Letta, which is most likely to tear itself apart if any real reforms seem imminent. But let’s wish him luck. As an example of Italy’s political incoherence we can point this week to the splendid piece of governmental incompetence displayed by the tax agency’s announcement of a 20 percent withholding tax on monies received from “abroad,” which it was forced to withdraw within 48 hours after the EU pointed out that it was illegal. That seems obvious: how can mandatory “withholding” be applied to cross-border EU transfers in a way … Read More »


Let’s Hear It For Luxembourg

Posted on February 9th, by Global Tax Weekly in Banking, Corporation Tax, Individual Taxation, Offshore. No Comments

Why does Luxembourg want to deny that’s it’s a “tax haven”? “Profiting ‘fiscally’ from other countries.” Well, we know why: because in dying Europe it’s not politically correct to compete against other countries any more, so Luxembourg has to pretend that it doesn’t have an advantageous tax regime. But it does! And its efforts to cling on to that regime are the reason for giving it a prize. While pretending otherwise, Luxembourg is engaged in fighting a rearguard action against the extension of the Savings Tax Directive and AEI (automatic exchange of information). It refuses, quite correctly, to give in to the EU’s demands for a much more encompassing Directive until all of its competitor nations (Switzerland, Singapore, Hong Kong etc) sign up to similar rules, which hopefully will never be the case. Let’s be clear: people should pay their … Read More »


Down With The EU

Posted on January 21st, by Global Tax Weekly in Banking, Trade. 1 Comment

David Cameron and George Osborne have been EU-bashing again this week, and they mean what they say as regards the financial transactions tax and financial services regulation. It’s not clear that they mean what they say as regards immigration: they have to pretend to be against it in order to placate would be supporters of UKIP and other lunatic fringes. In fact, as they know very well, the UK has benefited enormously from successive waves of immigration resulting from illiberal and repressive policies pursued by successive Continental tyrants, from Huguenot weavers in the seventeenth century to Jewish scientists in the 20th. Countless surveys have shown that immigrants add value to the UK, work harder and are less of a drain on the social services than native Brits; but if they want to get re-elected Tory leaders have to pretend otherwise. … Read More »


Bits And Pieces

Posted on January 16th, by Global Tax Weekly in Banking, Currency, E-commerce. No Comments

Singapore has issued some quite sensible guidance on tax aspects of bitcoin transactions, which suggests that there must be a fair amount of bitcoin activity there. The first Asian bitcoin conference was held in Singapore last year, at any rate. Bitcoins join Uzbekhistan on the list of subjects on which I am passing ignorant. I keep trying and failing to understand the phenomenon of bitcoins. Theoretically one should be in favor of a virtual currency with, so to speak, monetary limits (unlike existing national paper currencies, which are being inflated out of sight by central banks who want to keep interest rates low), but I question the usefulness of a currency which by definition can never exist in large quantities. On the other hand, other, similar currencies could exist in large numbers. If there is a bitcoin, why shouldn’t there … Read More »


Winter Dreams

Posted on December 12th, by Global Tax Weekly in Banking, Budgets, Individual Taxation, International Taxation, Tax Avoidance. No Comments

The Tory toffs who are running the British Government seem to be doing a reasonable job, despite the LibDem barnacles encrusting their hull and slowing progress. The Chancellor’s Autumn Statement last week had some disappointing aspects, but by and large it does the right things, particularly by helping small businesses in various ways. I don’t know quite what to make of the grandiose package of tax avoidance measures: surely it is mostly grandstanding? Having committed themselves so thoroughly at the Lough Earne G20 summit to abolishing BEPS, they probably had no choice but to make a big song and dance about it. But most thoughtful commentators have by now concluded that the whole BEPS circus will change very little in the real world. So there is no point in criticizing the Brits for continuing to push the bandwaggon along. Even … Read More »


Who’d Be Switzerland?

Posted on October 14th, by Global Tax Weekly in Banking, Offshore. No Comments

Let’s suppose that one (you, that is, or me) was offered to be Prime Minister of a European country (and for this purpose we won’t count Russia as being European in the light of President Putin’s recent behavior) – which one would you choose? Obviously it won’t be Ukraine, because you’ll end up in prison, or Italy, because you’ll hardly be in the job long enough to get to know your chauffeur. I would probably choose somewhere civilized like Denmark, although the climate is not very nice, or perhaps Malta, where the climate is indeed very nice. But third on the list of countries I wouldn’t choose must surely be Switzerland, where the thankless job of leading the country involves a battle on at least three fronts, your external challenges coming from the USA and the European Union, and your … Read More »





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