Straining under the ever increasing costs of unification,
the German government and its tax officials have turned their
attention to neighboring Luxembourg and its offshore banking
system. Through offshore transactions are perfectly legal under
German law, a citizen's failure to disclose the existence of any
funds held offshore is considered indicative of tax dodging.
The German tax authorities are annoyed with Luxembourg's
banks who they feel condone, assist and encourage German
investors looking for a way of avoiding tax obligations.
The tax department have retaliated with a spate of raids on
German banks through which, it is believed, offshore transactions
have been taking place. One particular raid was covered live by
the German media. TV and newspapers were tipped off by tax
officials eager to demonstrate that offshore tax evasion will not
be tolerated or left unaddressed.
In the latest moves, tax officials have raided the homes of
any Luxembourg bank employees living in Germany. Investigators
seized a large amount of documents in the hope that the employees
had brought bank paperwork over the border to work on after
office hours. Some German investors will be biting their nails
until the paperwork has been thoroughly examined.
The aggressive German manoeuvre is based partly in response
to the Luxembourg banking community's continued unwillingness to
assist with German tax office inquiries. The German's want
details of German account holders. Luxembourg's banks won't hear
of it. The latest German action severely undermines the
supposition of an individual's right to banking secrecy.
Reprinted from The Mouse Monitor, The International Journal of
Bureau-Rat Control, a periodical published by
Scope International
for its customers.
