Toolkit for policy makers

Toolkit for policy makers

Despite the increasing interest of policymakers and other authorities to create a mixture of policy, strategic and legal instruments to frontally counter tax crimes in the EU, the uphill task of securing and sustaining any gains still requires a well-articulated toolkit to particularly bridge the gap between law in books and law in action.

The PROTAX policy toolkit mobilises experience from previous PROTAX reports and insights of emerging developments to design a unifying framework of tested ideas for tax crime policy effectiveness and efficiency. The toolkit provides novel and/or proven policy streams from which actionable plans and laws can be developed to fight tax crimes in the EU. The policy toolkit thus presents the key policy issues and thirteen policy recommendations. With its help, policymakers can easily spot emerging trends and opportunities for future measures in countering tax crimes. The focus of the toolkit is on harnessing practical countermeasures that can be leveraged by policymakers for implementation in the short to long term.

In particular, the toolkit is a carefully designed framework that can enable policy-makers to identify parameters of:

  • tax crimes such as the type of admissible evidence in tax crime cases for investigation, prosecution and successful conviction;
  • existing information-sharing agreements between the Member States and their law enforcement agencies (LEAs);
  • the harmonised elements of laws and regulations designed to combat tax crime;
  • legal protection for whistleblowers on tax crimes and the elements of whistleblower protection that require repurposing by the EU;
  • the communities of professional practice and knowledge that support the drafting of legislation.

The delivery of this toolkit happens to coincide with a fast-developing landscape for countering tax crimes including developments in the anti-money laundering (AML) framework and anti-tax fraud framework in the EU. These frameworks lay the foundation for any future policy toolkit to counter tax crimes. Although the existing frameworks demonstrate the increasing commitment of the EU and its Member States to tackle tax crimes, the PROTAX policy toolkit provides another layer of workable solutions to counter tax crimes in the EU. It will help the EU in formulating policy responses and in translating best practices into actionable plans and laws on tax crimes. The toolkit perfectly complements existing frameworks and provides a very useful framework for easy reference and future development of countermeasures against tax crimes in the EU.

Key Findings

  • A policy toolkit can complement and provide a useful reference framework for policymakers in the EU to develop countermeasures against tax crimes informed by best practices across the Member States as well as recommendations of international organisations such as the Financial Action Task Force (FATF) and Organisation for Economic Co-operation and Development (OECD).
  • Interagency domestic and international cooperation on countering tax crimes are still faced with significant constraints such as incompatible institutional responsibilities and legal frameworks, limited trust-based working relations, and communication and language problems between authorities.
  • Policy objectives and priorities should be reformulated to speak for and reflect the interests of all (e.g., involve citizens/tax payers) to strengthen collaboration across stakeholders and sectors.
  • Policymakers should ensure that there is a common basic understanding of thresholds and definitions (for instance professional enablers) for tax offences across the EU to facilitate mutual cooperation and enhanced compliance by citizens.
  • Since any productive decision depends on reliable data, a policy imperative that requires deliberate measures to enhance data/statistics and technologies on tax crimes will empower policymakers to achieve more desirable policy decision outcomes on tax crimes.

Please note that the law cited were valid and correct at the time of the reports publication.