Labour in ‘tax havens’ ultimatum

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Published: Friday 6th February 2015 by The News Editor

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Bermuda, Jersey and other British “tax havens” would have six months to open their books or face international blacklisting if Labour wins the general election, Ed Miliband has declared.

The Opposition leader accused David Cameron of failing to follow through on demands that all overseas territories and crown dependencies adopt transparency measures being introduced in the UK.

Agreement on action to expose the owners of “shell companies” used to evade tax was hailed by Mr Cameron as a key achievement of the UK-hosted G8 summit of world leaders in 2013.

But so far none of the countries around the world over which Britain retains sovereignty has accepted the Prime Minister’s appeal to them to “move forward together in raising standards of transparency” and some have ruled out reform.

In a letter to the leaders of the overseas territories and crown dependencies, Mr Miliband put them “on notice” that, if elected in May, his government would refer any that failed to produce publicly accessible central registers of beneficial ownership – who profits from a company – to the Organisation for Economic Co-operation and Development (OECD).

“I am writing to put you on notice that a Labour government will not allow this situation of delay and secrecy to continue,” he wrote.

“Labour will act on tax avoidance where the Tories will not,” he added – ending protection from international scrutiny and requesting OECD blacklisting.

Among potential measures against uncooperative tax regimes suggested by the G20 include withholding taxes on finance flowing there.

Mr Miliband, who has endured a torrid few days of attacks by business leaders over the potential impact of his party’s policies, told The Guardian: “There is nothing pro-business about defending tax avoidance.”

“More than 18 months have passed since David Cameron promised to shine a light on the tax havens in UK overseas territories and Crown Dependencies – and their affairs are still shrouded in darkness.

“That may be good enough for him, but it will not satisfy me, or the incoming Labour government

“And it is costing everyone who relies on our schools, our hospitals, our roads and our railways. It is costing everyone who pays their fair share of taxes, including millions of British businesses.

“Billions of pounds is being siphoned off into tax havens where our authorities cannot discover even the true ownership of firms registered there, let alone the scale of wealth hidden away.

“Today, I am putting these tax havens on notice that they will have just six months to open up their books or face international sanction.”

Mr Miliband said he would not be blown off course in his determination to tackle the issue by attacks from senior corporate figures.

“The reason this argument matters is much wider than who is attacking me, but why they are,” he told the newspaper.

“There are people who are going to say for the next 90 days that this country cannot change, and that this is as good as it gets. This week has just exemplified the fight we face so it is a battle between status quo and the change.”

A Conservative party spokesman said: “People should judge Ed Miliband by his record, not his rhetoric. For 13 years – including when he was an adviser in the Treasury – Labour did absolutely nothing to tackle tax avoidance. This shows that Ed Miliband is simply too weak to deliver on what he promises.

“In contrast, we are tackling the problem head-on. David Cameron put tax dodging at the top of the global agenda at the UK’s G8 summit, securing major new international rules to ensure that companies pay what they owe.”

Published: Friday 6th February 2015 by The News Editor

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