This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at http://www.theguardian.com/business/2016/apr/14/uk-under-pressure-from-eu-states-over-beneficial-ownership-secrecy
The article has changed 5 times. There is an RSS feed of changes available.
| Version 3 | Version 4 |
|---|---|
| UK and European allies plan to deal ‘hammer blow’ to tax evasion | UK and European allies plan to deal ‘hammer blow’ to tax evasion |
| (about 1 hour later) | |
| Britain and its European allies have announced new rules designed to be a “hammer blow” against tax evasion in direct response to the Panama Papers leak that exposed how the world’s richest and most powerful people hide their wealth from tax authorities. | Britain and its European allies have announced new rules designed to be a “hammer blow” against tax evasion in direct response to the Panama Papers leak that exposed how the world’s richest and most powerful people hide their wealth from tax authorities. |
| George Osborne announced on Thursday, in partnership with his counterparts from France, Germany, Spain and Italy, regulations that will lead to the automatic sharing of information about the true owners of complex shell companies and overseas trusts. | George Osborne announced on Thursday, in partnership with his counterparts from France, Germany, Spain and Italy, regulations that will lead to the automatic sharing of information about the true owners of complex shell companies and overseas trusts. |
| The chancellor said the rules, agreed this week, were “a hammer blow against those that would illegally evade taxes and hide their wealth in the dark corners of the financial system. | The chancellor said the rules, agreed this week, were “a hammer blow against those that would illegally evade taxes and hide their wealth in the dark corners of the financial system. |
| “Britain will work with our major European partners to find out who really owns the secretive shell companies and trusts that have been used as conduits for evading tax, laundering money and benefiting from corruption. | “Britain will work with our major European partners to find out who really owns the secretive shell companies and trusts that have been used as conduits for evading tax, laundering money and benefiting from corruption. |
| “Strong words of condemnation are not enough, populist outrage doesn’t by itself collect a single extra pound or dollar in tax or put a single criminal in jail,” Osborne said at the spring meetings of the International Monetary Fund in Washington DC. “What we need is international action now, and that’s precisely what we are doing today with real concrete action in the war against tax evasion.” | “Strong words of condemnation are not enough, populist outrage doesn’t by itself collect a single extra pound or dollar in tax or put a single criminal in jail,” Osborne said at the spring meetings of the International Monetary Fund in Washington DC. “What we need is international action now, and that’s precisely what we are doing today with real concrete action in the war against tax evasion.” |
| He said the transparency rules on beneficial ownership showed that Britain and other governments were working to shine a spotlight on “those hiding spaces, those dark corners of the global financial system”. Osborne said he hoped that the regulations, which will come into effect in January 2017, would be followed up by other countries. | He said the transparency rules on beneficial ownership showed that Britain and other governments were working to shine a spotlight on “those hiding spaces, those dark corners of the global financial system”. Osborne said he hoped that the regulations, which will come into effect in January 2017, would be followed up by other countries. |
| Ángel Gurría, the secretary general of the Organisation for Economic Co-operation and Development, said the release of the Panama Papers showed that there was no room for complacency in the international effort to crack down on tax evasion. He said it was no surprise that the rich and the powerful were using Panama to evade tax as “it is one of the few jurisdictions that has pushed against” international measures to improve tax and ownership transparency. | Ángel Gurría, the secretary general of the Organisation for Economic Co-operation and Development, said the release of the Panama Papers showed that there was no room for complacency in the international effort to crack down on tax evasion. He said it was no surprise that the rich and the powerful were using Panama to evade tax as “it is one of the few jurisdictions that has pushed against” international measures to improve tax and ownership transparency. |
| “We have to crack down on the professional enablers – lawyers, accountants, financial institutions – that play a key role in maintaining the veil of secrecy,” he said. | “We have to crack down on the professional enablers – lawyers, accountants, financial institutions – that play a key role in maintaining the veil of secrecy,” he said. |
| However, it has been reported that finance ministers from other European countries had pushed Britain to extend the new rules to all trusts, rather than just those that “generate tax consequences”. Tax transparency campaigners believe that this is likely to exclude many trusts deliberately constructed to avoid such consequences. | However, it has been reported that finance ministers from other European countries had pushed Britain to extend the new rules to all trusts, rather than just those that “generate tax consequences”. Tax transparency campaigners believe that this is likely to exclude many trusts deliberately constructed to avoid such consequences. |
| Britain has repeatedly played down concerns over tax evasion and other wrongdoing involving trusts. While they are a common feature of UK law, they are less familiar in mainland Europe and viewed with suspicion by many tax transparency campaigners. Bloomberg reported that UK officials had made it clear that Britain would continue to resist pressure, led by France, for reform. | Britain has repeatedly played down concerns over tax evasion and other wrongdoing involving trusts. While they are a common feature of UK law, they are less familiar in mainland Europe and viewed with suspicion by many tax transparency campaigners. Bloomberg reported that UK officials had made it clear that Britain would continue to resist pressure, led by France, for reform. |
| A spokesman for Osborne said there was no rift between the UK and France, or any of its other European partners. | A spokesman for Osborne said there was no rift between the UK and France, or any of its other European partners. |
| The chancellor also faced pressure in Washington because many world leaders hold Britain responsible for its overseas territories, several of which aggressively market corporate secrecy to wealthy companies and individuals around the world. | The chancellor also faced pressure in Washington because many world leaders hold Britain responsible for its overseas territories, several of which aggressively market corporate secrecy to wealthy companies and individuals around the world. |
| Tensions over trusts and foundations were papered over, however, when Germany, France, Spain, Italy and Britain published a joint letter announcing further steps on financial transparency. | Tensions over trusts and foundations were papered over, however, when Germany, France, Spain, Italy and Britain published a joint letter announcing further steps on financial transparency. |
| The UK is already committed to a public register of beneficial ownership, while many other countries are introducing registers that will be confidential. | The UK is already committed to a public register of beneficial ownership, while many other countries are introducing registers that will be confidential. |
| “We will look to ensure that this information is in a fully searchable format and that it also contains information on entities and arrangements closed during the relevant year,” the letter said. | “We will look to ensure that this information is in a fully searchable format and that it also contains information on entities and arrangements closed during the relevant year,” the letter said. |
| The letter was not signed by other G20 countries, including the US, which has consistently resisted calls for public registers of beneficial ownership. The US feels that such measures could harm states such as Delaware, which is known for providing corporate secrecy. | The letter was not signed by other G20 countries, including the US, which has consistently resisted calls for public registers of beneficial ownership. The US feels that such measures could harm states such as Delaware, which is known for providing corporate secrecy. |
| The European finance ministers’ letter is also not thought to be supported by Russia and China – both of which feature prominently in the Panama Papers. | The European finance ministers’ letter is also not thought to be supported by Russia and China – both of which feature prominently in the Panama Papers. |
| Addressed to fellow G20 countries, the letter says: “In our view, this new initiative will take a significant step forward in improving the transparency of beneficial ownership information and in removing the veil of secrecy under which criminals operate. | Addressed to fellow G20 countries, the letter says: “In our view, this new initiative will take a significant step forward in improving the transparency of beneficial ownership information and in removing the veil of secrecy under which criminals operate. |
| “The recent extensive leaks from Panama show the critical importance of the fight against tax evasion, aggressive tax planning and money laundering … Criminals continue to find ways to exploit the cracks in the current system, setting up complex structures in various and often multiple locations to hide their activities … As with tax evasion, this requires a global response.” | “The recent extensive leaks from Panama show the critical importance of the fight against tax evasion, aggressive tax planning and money laundering … Criminals continue to find ways to exploit the cracks in the current system, setting up complex structures in various and often multiple locations to hide their activities … As with tax evasion, this requires a global response.” |
| In a separate letter, Gurría noted that several countries had still not properly implemented the promised information-sharing arrangements for tax inspectors. | In a separate letter, Gurría noted that several countries had still not properly implemented the promised information-sharing arrangements for tax inspectors. |
| “Our standards on tax transparency are robust,” he said. “They need to be effectively implemented worldwide, by everyone, with no exceptions, so there’s nowhere left to hide.” Among the countries yet to implement information-sharing arrangements were Panama and Bahrain. | “Our standards on tax transparency are robust,” he said. “They need to be effectively implemented worldwide, by everyone, with no exceptions, so there’s nowhere left to hide.” Among the countries yet to implement information-sharing arrangements were Panama and Bahrain. |
| The French finance minister, Michel Sapin, said on Wednesday: “[The Panama Papers have] breathed new life into the tax evasion crackdown, they have accelerated the process. What has become clear is that we need complete cross-border transparency and international tools to deal with the problem.” | The French finance minister, Michel Sapin, said on Wednesday: “[The Panama Papers have] breathed new life into the tax evasion crackdown, they have accelerated the process. What has become clear is that we need complete cross-border transparency and international tools to deal with the problem.” |
| The shadow chancellor, John McDonnell, described the agreement as “a welcome step in the right direction” but said it failed to do anything to tackle tax havens based in British overseas territories. | The shadow chancellor, John McDonnell, described the agreement as “a welcome step in the right direction” but said it failed to do anything to tackle tax havens based in British overseas territories. |
| “Failure to take responsibility for these British dependencies substantially undermines the effectiveness of this agreement,” he said. “The chancellor describing this deal as a ‘hammer blow’ is concerning as it suggests that he thinks the job is done when clearly more work is still needed.” | “Failure to take responsibility for these British dependencies substantially undermines the effectiveness of this agreement,” he said. “The chancellor describing this deal as a ‘hammer blow’ is concerning as it suggests that he thinks the job is done when clearly more work is still needed.” |
| McDonnell said Osborne had been forced by campaigners and leaders of other countries to make the announcement and argued that “deep down he doesn’t want to go further”. | |
| He added: “We need a government that doesn’t drag its feet on tax avoidance, but takes a genuine lead on working with our international partners.” |