Carthy challenges PwC leader on tax scams in Panama Papers inquiry
The Panama Papers inquiry in the European Parliament held a hearing in Brussels today looking at the role of lawyers, bankers and accountants in facilitating tax avoidance, tax evasion and money laundering.
Sinn Féin MEP and inquiry committee member Matt Carthy challenged PriceWaterhouse Coopers Global Tax Policy Leader Prof Stef van Weeghel on the conflict of interest raised by the role of PwC and the Big Four in advising governments on tax issues.
Questioning Prof van Weeghel in the hearing, Carthy said: “I want to ask you about the role of PwC and the Big Four in advising EU governments on tax issues and the potential conflict of interest issue that raises.
"Let me give you an example from Ireland. In Ireland we have the PwC managing partner who has been involved in advising Google, Apple, Facebook and others on how to use Ireland as the centrepiece of their global tax avoidance strategies, including by setting up the notorious Double Irish loophole.
“But this same leader of PwC has also been acting as the chair of the American Chamber of Commerce tax group in Ireland. In this role PwC successfully ensured the withholding tax that required the 'Dutch Sandwich' to be used in conjunction with the Double Irish was scrapped. All the while, the PwC was separately advising the then finance minister on tax policy, who he also happened to be related to.
“Of course there is also the role played by PwC in the LuxLeaks scandal where the accounting firm designed the industrial-scale tax avoidance by multinationals that was then rubber-stamped by the authorities, which was only revealed through the actions of two former PwC employees and whistleblowers.
"So in at least two member states of the EU we can see that PwC has played a major role not only in facilitating massive tax avoidance by multinationals – but also in directly designing the whole system that encourages it, even at the government level.
“How can the Big Four justify the conflict of interest between advising multinationals on how to avoid paying tax, while at the very same time playing a major role in designing states’ tax laws?