EU Economy
EU commissioner faces tax fraud charges in Belgium
By Finfacts Team
Nov 14, 2013 - 12:50 AM

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A tax fraud case with Karel De Gucht, EU commissioner for trade, and his wife as defendants, is due to commence in the Flemish city of Ghent on November 25.

They are accused of evading taxes on €1.2m of income.

The tax authorities are demanding €900,000 in back taxes, interest and fines from the Belgian politician and lawyer.

There is no capital gains tax in Belgium and the tax claim relates to shares in a privately-held company that De Gucht sold in 2005. The Belgian tax authorities say that the sales were professional income and thus should be taxed at normal income tax rates not as capital gains.

The tax authorities are also investigating the purchase of a holiday home in Italy and in 2011, the commissioner complained that a new law that relaxed Belgian bank-secrecy rules had given tax authorities too much power to trawl through accounts and he asked a court in Ghent to refer the law to the Constitutional court.

Last March Belgium’s Constitutional Court ruled that the law that allows inspectors from the Inland Revenue access to bank account details is not contrary to privacy laws.

Apart from the tax allegations, this man's claim that the tax authorities should not have had access to his bank accounts, is contrary to the position of the European Commission on sharing bank information to combat tax evasion.   

Nevertheless, Pia Ahrenkilde Hansen, a European Commission spokeswoman, said last week: “This is about a case which has no impact on the work done by Mr De Gucht during his time as commissioner and it is linked to something which happened before he was named as a commissioner.”

John Dalli, an  ex-health commissioner, was forced out of his job last year over corruption allegations.

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