Finance ministers scold Moscovici over tax-avoidance labeling

The anger stemmed from comments the commissioner made after the EU published a report on aggressive tax planning in the bloc.

Seven finance ministers slammed the European Commission’s tax czar on Tuesday behind closed doors for publicly naming and shaming their countries last week for enabling tax avoidance in the EU.

Finance ministers from Belgium, Cyprus, Hungary, Ireland, Luxembourg, Malta, and the Netherlands all took turns berating Pierre Moscovici during the closed session of the ECOFIN meeting in Brussels.

But Moscovici was prepared for the altercation after the countries’ diplomats said last week that their finance ministers would corner the French commissioner for his action.

The anger stemmed from comments that Moscovici made after the EU’s executive arm published a report that analyzed aggressive tax planning in the bloc during its European Semester process scrutinizing EU members’ economies.

Commission officials maintain that the countries were forewarned about the revelations in the individual country reports in the European Semester package. But the accused finance ministries strongly disputed that account.

“This year’s emphasis on aggressive tax planning goes way beyond the emphasis on the remit of the European Semester,” Luxembourg’s Pierre Gramegna told Mosvocivi, who officials said “wasn’t listening” and was busy texting on his phone. “The naming of the seven countries is extremely unusual.”

After the finance ministers had their say, however, Moscovici responded: “This isn’t a crusade,” according to the officials. “The Commission is the first to defend different countries when people say that there are tax havens in Europe” — including his own use of Twitter to do so, Moscovici said.

But he also stressed that “a lot more progress” is needed to fully address aggressive tax planning across the EU.

Finance ministers weren’t convinced, said the officials, who warned that his comments could come back to hurt him in the future. “It wasn’t a good thing for Moscovici because already a lot of people didn’t like him and now the situation is worse,” one official said.

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