Luxembourg

Luxembourg, officially the Grand Duchy of Luxembourg, is a small landlocked country in Western Europe. Although it is a very small country, it ranks among the richest countries in the world in the tables. The capital, Luxembourg, is the eighth largest financial center, home to more than 160 international banks. Luxembourg is associated with traditional bank secrecy, which has been in place since 1929.

In recent years, however, there has been increasing pressure from European states to exchange tax information in order to prevent tax evasion and money laundering. Although Luxembourg wanted to maintain an exemption in signing these treaties, it ended up following the same rules as other countries.

Luxembourg became a tax haven when Jean-Claude Juncker, who later became Prime Minister of the European Commission, was prime minister. At the end of 2014, an international consortium of investigative journalists released documents (LuxLeaks) that show that more than 340 multinational companies should have negotiated a lower tax rate with the Luxembourg authorities, thus saving billions of dollars in taxes. Not only did the whole case lead to increasing pressure on European Commission President Junker, but also on Luxembourg itself.

Currently, within the framework of the Organization for Economic Cooperation and Development (OECD), an agreement has been established on the exchange of information on financial accounts, as well as a whole range of other sensitive data. The agreement will enter into force in 2017 and has been joined by both European Union states (including Luxembourg) and classic offshore jurisdictions, such as the Cayman Islands or the British Virgin Islands, and even Switzerland. This agreement could be described as the end of banking secrecy in the tax area of ​​the countries that have signed the agreement.

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