The Guardian has, I think fairly based on my briefings, summarised Downing Street's tax objectives for the G8 as being:
1. Strong G8 political support for a new OECD action plan due to be given to G20 finance ministers in July setting out how to end corporation tax loopholes covering issues such as transfer pricing, intellectual property and country by country reporting. Final outcome in two years
2. Clear support at special meeting on Saturdayfrom UK crown dependencies and overseas territories to sign OECD agreement on transfer of tax information on request.
3. G8 political support to develop worldwide standard on automatic tax information transfer based on a pilot agreed, but not implemented between the US, G5 and some UK Crown dependencies. This currently excludes developing countries.
4. A G8 agreement on beneficial ownership, a means of revealing the true identity of shell companies, mainly in tax havens. The register will either be accessible to public or tax authorities.
5. Agreement to help developing countries build their tax base and handle tax information.
The first is easy: support comes cheap.
The second is unlikely: Bermuda has cold feet and Cayman is luke warm. Jersey will join that pack.
Agreeing to automatic information exchange would be welcome, but it would be fairly empty rhetoric without information on beneficial ownership. Canada, the UDS and Russia are objecting to that and the UK simply does not have such data. The tax havens are saying no. This one is going to be the stumbling block.
I'd love to see real help for developing countries. We'll get a commitment instead and that's not the same thing.
But I may be proved wrong by Tuesday night when I'll be flying back from Enniskillen. I hope so. But am not holding my breath.
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“A G8 agreement on beneficial ownership, a means of revealing the true identity of shell companies, mainly in tax havens. The register will either be accessible to public or tax authorities”
Surely this should read “A G8 agreement on beneficial ownership, a means of revealing the true identity of all companies. The register will either be accessible to public or tax authorities”
The use of nominee holdings is widespread in the UK for example. And is Delaware included in this?
Are all of the tax havens saying No?
The UK and US cannot comply with this at present – a massive obstacle to progress which the tax havens are exploiting
For once I have some sympathy with them
I want Cameron to say he’s reforming Companies House and Co Law – then I’ll believe him
Well it’s a bit unfair saying the tax havens are exploiting this – the state of Delaware (US) and the UK (non Dom haven)
Don’t require disclosure of beneficial ownership for private companies.
In the IFCs at least there is a regulated person who knows who the beneficial owners are – there is none of this in the US or UK quite often.
There really is very little excuse why the UK and the US haven’t regulated formation agents and required that this information is provided. It’s been collected for nearly 10 years by the IFCs
The disconnect possible in the UK and the US encourages the use of these structures for illegal activity.
So it is in fact felons exploiting the us and uk regulatory lacuna
Which is why TJN has long named the UK and US as major secrecy jurisdictions
I’m curious as to why specifically,’Canada, the UDS and Russia’ would oppose “a means of revealing the true identity of shell companies”. Russia presumably is in the grip of its oligarchs, but Canada, and the identity of the ‘UDS’ escapes me?
US
Canada is ideologically committed to tax havens
US has no data
Richard
For once I must give you full credit for recognising and sympathising with the “tax havens”. It is absolutely right that they are not obliged to adopt standards which the UK and US will not or cannot adopt.
I cannot see the US or UK changing their stance on this, so I suspect it will get kicked into the long grass.
I also suspect that there will be a major derailment of FATCA because the US will not be able to reciprocate information for constitutional reasons.