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PM Cameron warns 10 Overseas Territories on tax issues: ‘get your house in order’

Wednesday, May 22nd 2013 - 00:16 UTC
Full article 23 comments
The letter from Cameron comes ahead of a G8 summit in June, when the UK is expected to push for tighter tax measures The letter from Cameron comes ahead of a G8 summit in June, when the UK is expected to push for tighter tax measures

Prime Minister David Cameron has urged British overseas territories to “get their house in order” and sign up to international treaties on tax. He wrote to 10 territories and crown dependencies, including the Cayman Islands and the Isle of Man, which operate low-tax regimes.

Critics claim such places are used by companies for tax avoidance or evasion. The plea came ahead of a G8 summit in June, when the UK is expected to push for tighter tax measures.

“With one month to go, this is the crucial moment to get our own houses in order,” Mr Cameron wrote in the letter.

“I respect your right to be lower tax jurisdictions... but lower taxes are only sustainable if what is owed is actually paid.”

The ten territories that received the letter are Bermuda, the British Virgin Islands, the Cayman Islands, Gibraltar, Anguilla, Montserrat, the Turks and Caicos Islands, Jersey, Guernsey and the Isle of Man.

Some have been described by the UK government as having “complex tax arrangements”.

Low taxes and light touch regulation have seen some of them become major centres for international business. But the lack of transparency in their banking systems has left them open to accusations that they are being used to avoid paying taxes.

Mr Cameron urged them to sign international protocols designed to allow tax information to be shared more easily between countries, and also to take measures to improve their own transparency.

“Put simply, that means we need to know who really owns and controls each and every company,” he said.

Tax avoidance, where companies operate within the rules to avoid paying taxes, and tax evasion, which is outside the law, have risen high on the political agenda in recent months.

High-profile companies like Google, Amazon and Starbucks have faced criticism in the UK for the low levels of tax they appear to pay compared with the size of their businesses.

On Sunday, Google's executive chairman Eric Schmidt defended the company's tax affairs. He said the search engine giant “has always aspired to do the right thing”, but added that “international tax law could almost certainly benefit from reform”.

Writing in the Observer, he said he wanted ”to move the debate forward
 

Categories: Economy, Politics, International.

Top Comments

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  • DanyBerger

    So Camoron in another article claim to be proud to be the PM of the tax low corporation tax (20%)

    But press others to put their house in order. And the self-Determination?

    CaMoron not only idiot also hypocrite.

    May 22nd, 2013 - 04:36 am 0
  • Anglotino

    This can't be right. Supposedly these are colonies and don't control their own government according to people such as Dany and Think.

    Couldn't the UK government just unilaterally raise the tax rates and close the loopholes instantly?

    Don't you just love it when reality collides with other people's bullshit and shows how bereft of substance their claims are.
    (Oh cue Think and his rants about English blah blah blah.... *switch off).

    May 22nd, 2013 - 05:11 am 0
  • Troy Tempest

    @1 Dany

    You misrepresent the truth AGAIN.

    As the article said,
    ”Tax avoidance, where companies operate within the rules to avoid paying taxes, and tax evasion, which is outside the law, have risen high on the political agenda in recent months.

    The point being that low tax regimens are fine, as long as they are sustainable and not used to EVADE taxes.

    MicroSoft is in USA Senate Investigation to explain how they legally exploited tax laws in Eire to stash away $40b tax-free.

    These reforms are about keeping corporations honest and paying their proper share of taxes.

    I suppose that's an unknown concept in Argentina, where corruption is seen as the norm. And you criticise us.

    No wonder your society is in so much trouble.

    May 22nd, 2013 - 05:11 am 0
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