Osborne has paid lip service to tackling tax havens, but when will the hard work actually start?

Ten of the world’s tax havens are UK-linked territories - the British Overseas Territories and Crown Dependencies. The clue is in the names.

Share
Related Topics

A year ago none of us expected David Cameron and George Osborne to stand on the UK and global stage and herald themselves the tax heroes that the world desperately needs. But that’s exactly what they have done by promising to tackle tax dodging and tax havens at the UK’s G8 Summit.

It’s about time someone got serious about tackling tax dodging. Today trillions of dollars are stashed offshore in tax havens, far beyond the reach of the tax man. This means that these tropical islands and small land-locked countries are sucking hundreds of billions out of public budgets here and in the poorest countries, forever. This is money that could create jobs and opportunities here in the UK as we continue to be buffeted around on the rocks of austerity, and face draconian cuts to welfare. Crucially for the poorest countries it is money that could, if recouped, help the one in eight people in the world who will go to bed hungry tonight.  

Cracking down on tax havens could be a game changer here in the UK, and around the world.  So far so good.  But today, George Osborne and the other G7 finance ministers will not be talking tax. This close to the Loch Earne Summit, it begs the question: why not?

There is an elephant in the room with George as he sits down today. Ten of the world’s tax havens are UK-linked territories - the British Overseas Territories and Crown Dependencies. The clue is in the names.

Nobody can deny that there is a job to be done to get these territories back on the straight and narrow. The Enough Food for Everyone IF campaign, which is backed by almost 200 organisations including Oxfam, took that message directly to the Treasury yesterday. New research released by the campaign for today’s meeting shows that if the money in the Cayman Islands really did belong to the people of the Caymans, it would mean each of them, on average, was worth $29.3 million. This is not because all Caymanians are dripping in diamonds and sitting on personal fortunes. It’s because their shores are attracting trillions from around the world due to the islands' tax haven status – including secrecy for sale and low tax rates. There are 174 companies operated by Barclays in the Cayman Islands, a territory with a 0 per cent effective corporate tax rate. And the story is not so different in the other UK-linked tax havens.  It is an ugly truth that the UK needs to face up to.

There is a real risk that our leaders see the G8 tax job as done. Last week they did announce co-operation with the British Overseas Territories.  A deal that will see these tax havens – Anguilla, Bermuda, The British Virgin Islands, Montserrat and the Turks and Caicos Islands – sharing tax information with the UK.  This could be good news for us, but does nothing for the poorest countries, so unless there is more in the UK’s bag of G8 tricks, this is far from good enough. It would be a categorical failure on their own objective of ‘putting their own house in order and helping developing countries to prosper’ if this is all they have to give.

It does show that where there's political will there's a way. So the real test now is whether the Government is willing to extend that will to helping the poorest countries in the world. With just 5 weeks to go, it’s time to get serious.

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Recruitment Genius: Business Development Executive / Digital Marketing Executive

£26000 - £35000 per annum: Recruitment Genius: A luxury beauty house with a nu...

Recruitment Genius: Housekeepers - Immediate Start

£8 per hour: Recruitment Genius: This company are currently recruiting new exp...

Recruitment Genius: Head Concierge

£25000 - £28000 per annum: Recruitment Genius: This award winning Property Man...

Recruitment Genius: Content, SEO and PPC Executive

£20000 - £25000 per annum: Recruitment Genius: A fantastic opportunity has ari...

Day In a Page

Read Next
 

Clean energy should be our mission to the moon

Martin Rees
Angela Merkel and David Cameron say goodbye in the Bundeskanzleramt after their meeting in Berlin, Germany, 29 May 2015  

The complacency of Europhiles could lose them the referendum

Steve Richards
On your feet! Spending at least two hours a day standing reduces the risk of heart attacks, cancer and diabetes, according to new research

On your feet!

Spending half the day standing 'reduces risk of heart attacks and cancer'
Liverpool close in on Milner signing

Liverpool close in on Milner signing

Reds baulk at Christian Benteke £32.5m release clause
With scores of surgeries closing, what hope is there for the David Cameron's promise of 5,000 more GPs and a 24/7 NHS?

The big NHS question

Why are there so few new GPs when so many want to study medicine?
Big knickers are back: Thongs ain't what they used to be

Thongs ain't what they used to be

Big knickers are back
Thurston Moore interview

Thurston Moore interview

On living in London, Sonic Youth and musical memoirs
In full bloom

In full bloom

Floral print womenswear
From leading man to Elephant Man, Bradley Cooper is terrific

From leading man to Elephant Man

Bradley Cooper is terrific
In this the person to restore our trust in the banks?

In this the person to restore our trust in the banks?

Dame Colette Bowe - interview
When do the creative juices dry up?

When do the creative juices dry up?

David Lodge thinks he knows
The 'Cher moment' happening across fashion just now

Fashion's Cher moment

Ageing beauty will always be more classy than all that booty
Thousands of teenage girls enduring debilitating illnesses after routine school cancer vaccination

Health fears over school cancer jab

Shock new Freedom of Information figures show how thousands of girls have suffered serious symptoms after routine HPV injection
Fifa President Sepp Blatter warns his opponents: 'I forgive everyone, but I don't forget'

'I forgive everyone, but I don't forget'

Fifa president Sepp Blatter issues defiant warning to opponents
Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report

Weather warning

Extreme summer temperatures will soon cause deaths of up to 1,700 more Britons a year, says government report
LSD: Speaking to volunteer users of the drug as trials get underway to see if it cures depression and addiction

High hopes for LSD

Meet the volunteer users helping to see if it cures depression and addiction
German soldier who died fighting for UK in Battle of Waterloo should be removed from museum display and given dignified funeral, say historians

Saving Private Brandt

A Belgian museum's display of the skeleton of a soldier killed at Waterloo prompts calls for him to be given a dignified funeral