Grilling over Scholz’s handling of multibillion-euro tax evasion ends in stalemate

  • Scholz testifies before Hamburg lawmakers on fraud handling
  • Case risks undermining Scholz as he faces multiple crises
  • Scholz’s popularity trails top ministers, SPD third in polls

BERLIN, Aug 19 (Reuters) – Hamburg lawmakers have questioned German Chancellor Olaf Scholz about his handling of a billion-euro tax evasion while he was the city’s mayor. him to obscure the truth.

Although the 3.5-hour hearing offered no new insight into the ‘cum-ex’ scandal, the drag on the case threatens to undermine the Chancellor, who is struggling to keep his coalition restless in the face of the ‘public opinion. dissatisfaction with soaring energy prices.

Under “cum-ex” or dividend stripping, banks and investors would quickly trade shares of companies around their dividend payment day, blurring shareholding and allowing multiple parties to wrongly claim refunds. dividend tax.

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The loophole, now closed, took on a political dimension in the northern port of Hamburg due to the slowness of authorities in 2016 when Scholz was mayor to demand reimbursement of the millions of euros won in the scheme by the local bank. Warburg.

Warburg, which plays an important role in Germany’s second-largest city, finally paid its tax bill of around 50 million euros ($50.3 million) after the federal finance ministry intervened.

“I had no influence on the Warburg tax case,” Scholz said on Friday during his second appearance before Hamburg’s parliamentary inquiry into the cum-ex affair, one of the biggest scandals in Hamburg. post-war business in Germany.

“There is nowhere the slightest suggestion that I have accepted anything,” he said, referring to dozens of other testimonies before the committee over the course of 2 and a half years of trial. investigation.

Scholz again insisted that he did not recall the content of the three meetings he had at the time with the chairman of Warburg, adding that he had also met with representatives of other banks as as mayor.

“The Chancellor, in effect, today refused to take part in the investigation,” said Richard Seelmaecker, the opposition Conservatives’ representative on the commission, quipping that Scholz would have to undergo hypnosis to find his lost memories.

Seelmaecker said Scholz may be called to testify before lawmakers for the third time as new findings from the investigation have just emerged.

The chancellor’s popularity is lower than that of his economy and foreign ministers, while only 58% of Germans think he is doing a good job compared to an average of around 70% for his predecessor, Angela Merkel , during his 16 years in office.

His Social Democratic Party (SPD) slipped to third place in the polls behind the opposition Conservatives and the Greens.


Finance Minister Christian Lindner of the junior coalition party, the pro-business Free Democrats, which is also trailing in the polls, threw his support behind the Chancellor on Friday.

“I have always considered Olaf Scholz to be a person of integrity, whether I was in opposition or now in government – and I have no reason to doubt that now,” Lindner told the Rheinische Post newspaper.

Prominent Greens have remained silent on the matter after criticizing Scholz about it while in opposition.

Recent headlines that prosecutors investigating the scheme in Hamburg discovered 200,000 euros in the safe of a local politician from Scholz’s ruling Social Democrats have revived suspicions of political intervention on behalf of the bank. .

Scholz denied any knowledge of the money or its origin and said he had no further contact with the lawmaker involved. The lawmaker did not respond to a request for comment.

“I harbor the hope that the guesswork and innuendo can stop,” Scholz said. “They have no basis.”

The Chancellor clashed with lawmakers in Hamburg last year.

Gerhard Schick, director of the watchdog Finance Watch Germany and a former Greens lawmaker in the lower house of the federal Bundestag, said he doesn’t believe Scholz has been forgotten.

“I think it’s a pretense and hurts his credibility,” he said.

One of prosecutors’ recent discoveries is a discrepancy between Hamburg authorities’ numerous calendar entries mentioning the Warburg bank and “cum-ex” and the few emails on the subject, Der Spiegel magazine wrote, citing the prosecutors’ report.

“This suggests targeted suppression (of emails),” Spiegel said, citing the report.

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Reporting by Sarah Marsh and Andreas Rinke; Additional reporting by Hans Seidenstuecker and Jan Schwartz; edited by Andrew Cawthorne, Toby Chopra and Leslie Adler

Our standards: The Thomson Reuters Trust Principles.

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