BERLIN
German Chancellor Olaf Scholz strongly denied any involvement in a multibillion-euro tax fraud scandal during his tenure as Hamburg mayor, appearing Friday for his third testimony before a parliamentary committee.
The Social Democrat, who served as Hamburg’s mayor from 2011 to 2018, faced fresh questioning about his alleged dealings with banks involved in the “cum-ex” scandal, which has been described as one of Germany’s biggest tax frauds.
“I have always advocated for a fair tax system throughout my political career,” he told the investigation committee of Hamburg parliament, adding that the allegations made against him were baseless claims lacking any supporting evidence. He also reaffirmed his support for thorough investigations into tax evasion schemes.
The “cum-ex” scandal, which involved multiple financial institutions exploiting a loophole in tax laws, is estimated to have cost German taxpayers more than €30 billion ($31.7 billion). Dozens of banks helped their clients trick governments, and claim a refund for a tax they had never paid for.
Scholz’s testimony centered on his dealings with HSH Nordbank, which allegedly obtained tens of millions of euros in illegal tax refunds from 2008 to 2011. Opposition parties claimed he helped cover up HSH Nordbank’s involvement in the scandal while the bank was negotiating a potential sale to US investors.
Earlier accusations against Scholz centered on Warburg Bank, where opposition politicians claimed he used his political influence in 2016 to help the bank avoid repaying €47 million ($49.7 million) in illegal tax refunds. Scholz consistently maintained that he had no influence over the decisions of Hamburg tax authorities during that period.
The chancellor’s testimony came at a politically sensitive time, as Germany prepares for snap elections in February. The opposition has sought to use the cum-ex scandal to challenge Scholz’s credibility ahead of the polls, which were called after Scholz’s three-way coalition with the Greens and liberal Free Democrats (FDP) collapsed last month due to intense disputes concerning economic policy and the government’s spending plans.
