Slightly humbled crusaders--Pierre Gramegna, Xavier Bettel, Etienne Schneider and Felix Braz at Thursday's press conference
Politics: Prime minister Xavier Bettel and finance minister Pierre Gramegna have said that tax rulings unveiled by the so-called LuxLeaks papers comply with national and international law.
The storm of criticism that was unleashed upon Luxembourg by the so-called LuxLeaks papers late on Wednesday evening shows no sign of abating. But the government has responded by saying that the anticipatory tax deals unveiled by the leaked documents--obtained illegally from financial services Big Four company PricewaterhouseCoopers--complied with Luxembourg and European law and current international standards.
Finance minister Pierre Gramegna said that such deals could only exist with the compliance of other countries. “The problem is an international one,” he said on Thursday morning, flanked by prime minister Xavier Bettel, minister of the economy Etienne Schneider and justice minister Felix Braz--the four crusaders of the Gambia coalition government, as pictured on the cover of Delano sister publication Paperjam released the same day.
But, Gramegna also said that the current government was not in favour of tax optimization. Speaking later in Brussels as he arrived for the Ecofin meeting of EU finance and economy ministers, he said, “What is legal today might no longer be desirable or meet with our ethical standards. This is an untenable situation for us and our citizens in Europe, who have to pay taxes while some companies pay so little."
Luxembourg has pledged to cooperate with the EU commission on "specific cases." Luxembourg will also be among the first countries to transpose EU directives relating to taxation and to support OECD initiatives to tackle tax avoidance. “We are not thrilled by the image of Luxembourg in the media,” said prime minister Xavier Bettel. “It is up to us to demonstrate the efforts we have made over the last few years, and which will continue.”
But in an interview with the Süddeutsche Zeitung in Germany Bettel said that he did not understand accusations of unfair taxation. “If my neighbour is in debt and therefore raises taxes, I can’t also raise my taxes just to ensure my neighbour feels better.”
Meanwhile, international pressure began to mount on freshly installed president of the EU Commission Jean-Claude Juncker, who was prime minister of Luxembourg during those years covered by the LuxLeaks documents. Formally appointed just last Saturday, 1 November, Juncker has so far failed to comment on the leaked documents story or on his own position as president of the Commission investigating allegations of tax rulings that could be construed as state aid from Luxembourg to Amazon and Fiat.
In reply to a question about how Juncker had reacted to Thursday’s LuxLeaks story making headlines around the world, Commission spokesman Margaritis Schinas said on Thursday morning that his boss was “serene about it.”