(CS/TJ) Luxembourg's neighbour Belgium is to officially list the country as a tax haven, local media report, based on its non-compliant status with the OECD's Global Forum.
All countries that have been on the OECD's list of fiscal paradises need blacklisted in Belgium, the law stipulates. This also includes Luxembourg, which was deemed non-compliant on tax transparency by the OECD's Global Forum in a 2013 report.
The Global Forum has since agreed to a request by Luxembourg for a reassessment in light of several legislative changes, such as a reform of banking secrecy laws.
Prime Minister Xavier Bettel commented to RTL on Tuesday that Belgium's decision to blacklist Luxembourg had been foreseeable, adding that until the Global Forum review was concluded other countries could follow suit.
The news was first announced by Belgian media Le Soir and De Morgen.
The decision would require all transactions over 100,000 euros to be reported to authorities, creating administrative hurdles for companies doing business across the border between Belgium and Luxembourg.
Belgian tax expert Michel Maus commented that the decision to blacklist Luxembourg came at a time when the Grand Duchy was taking steps to become more transparent, also in light of the LuxLeaks scandal.
Maus warned of “diplomatic difficulties,” speaking to Le Soir.
CSV MPs Gilles Roth and Marc Spautz on Tuesday submitted an urgent parliamentary question asking whether the Prime Minister of Finance Minister Gramegna had known of this development in advance. They also asked about the effects the decision would have and wanted to know whether Luxembourg is considering appealing the move.
An answer to the question is yet to be filed.