Rehn calls for end to tax havens

The Vice-President of the EU Commission Olli Rehn has called for an end to tax havens. In his view, the well off in Greece should pay taxes in their own country. He was speaking on the Yle TV1 programme Ykkösaamu on Saturday.

Olli Rehn TV1:n Ykkösaamussa lauantaina. Image: Yle

A move to abolish tax havens would require a greater harmonization of taxation within the EU. Rehn said this could only succeed with stronger legislation than exists at present. This, in turn, demands dropping the principle of qualified majority voting, in practice the right of veto, Rehn told the programme.

Understanding over EU transaction tax

Olli Rehn added he understood the creation of an EU financial transaction tax was difficult for the Finnish government to swallow. His comment came just a day after the government announced it was still unable to decide on the issue.

Rehn went on to comment that progress in establishing a transaction tax was in the hands of eurozone members and required serious consideration.     

”It is essential that many nations sign up in order to allay fears of mutual competition.”

Rehn added that the positive response from Estonia to the tax had not come by surprise.

He told the programme, the EU proposal was that the tax would be taken from the EU budget to cover certain union expenditures. In return member states would receive assistance in EU membership payments.

Rehn thanks Greece for belt tightening

The Vice-President also thanked Greece in the interview for its efforts to balance the books.

In his view, Greece had achieved a lot but reiterated that savings were the only way out as the country had lived beyond its means for a long time.  

Rehn believed that international inspectors would soon publish their report on Greek finances. A green light from the troika of lenders is essential in order for the country to receive the next bailout payment.

Rehn challenged the view that the economic downfall of Greece would no longer be a catastrophe.  He commented that those demanding a stop to financial support should understand who would suffer the most.

He added that Greece's exit from the eurozone would not only be fatal for the Greeks but also for the rest of Europe.

ESM an important step to economic and monetary union

The permanent EU bailout fund – the European Stability Mechanism or ESM comes into use next Monday. Rehn described it as an important step in the strengthening of building an economic and monetary union.