On the surface it looks like common sense to automatically exchange information. However, there is a downside to this. If two states agree on the automatic exchange of information, and the agreement is published, no control whatsoever is applied on stream of information. The tap is running and no one is checking the water. Data of corporations and individuals are exchanged and no one can and will check if the data is correct. So if a local tax official makes a mistake and includes - for example - the wrong group of people into the automatic flow of information, no one can do anything about this. The individual taxpayer cannot appeal, has no rights whatsoever.
Is it all worth it? I mean, one could argue that the rights individual taxpayers are less important than the rights of the EU. The EU is entitled to fair tax revenues. Yes, a lot of taxes are evaded, but then again, often based on legal frameworks (like tax treaties). EU member states concluded tax treaties with a purpose, namely to stimulate trade. The UK now officially announced they want to attract many more companies to the UK. Only one way they can do that, namely introducing favourable tax regimes.
Smaller countries like Belgium, The Netherlands and Luxembourg were forced to do that many years ago. That is the only way for small countries to attract business. Big countries like the UK, France and Germany did not feel that need because they already have a lot of multinationals within their borders. But because of the worldwide financial crisis we are in right now, the rules have changed and big countries (like the UK) will also actively promote favourable tax regimes.
From that perspective it is politically easy to divert the attention to individuals and corporations in stead of addressing the root cause namely the fact that we do not have a harmonised tax system in the EU. That is what European policitians really should focus on.
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