Cameron summons Bermuda to London for tax evasion talks
Premier Craig Cannonier has been summoned to a London summit as Prime Minister David Cameron pushes for more transparency to end what he terms the “scourge of tax evasion”.
Mr Cameron has warned Britain’s Overseas Territories and Crown Dependencies that he has made tax avoidance a priority of the G8 summit, which he is hosting in Northern Ireland on June 17 and 18.
According to UK media reports, senior ministers from ten jurisdictions including Jersey, Bermuda and the Cayman Islands have been invited to a meeting this month where they will be urged to sign up to greater tax transparency.
Finance Minister Bob Richards is likely to be among senior ministers from Bermuda who will attend the summit — but “details are still being worked out”, a Government spokeswoman last night told
The Royal Gazette.
Mr Cameron has warned overseas territories of the need to “get our own houses in order” and will attend the Open for Growth conference on the weekend before the G8 summit opens, the Daily Mail reported.
Senior ministers from Bermuda, the British Virgin Islands, the Cayman Islands, Gibraltar, Anguilla, Montserrat, the Turks and Caicos Islands, Jersey, Guernsey and the Isle of Man are expected to attend.
“Some of the islands and outposts are widely regarded as offshore tax havens, though they dispute this description and regard their low-tax regimes as vital to their economies,” the Daily Mail said. “There is said to be disagreement in Whitehall about how much pressure to put on the islands, fearing excessive demands from London could lead to them refusing to cooperate.
“Mr Cameron is examining the idea of getting the tax havens to sign up to an OECD convention on the sharing of information on tax between countries, which is seen as a key to tackling evasion.”
Last month Mr Cameron wrote to the British overseas territories, including Bermuda, warning them that he had made “fighting the scourge of tax evasion and aggressive tax avoidance a priority for the G8 summit”.
He added: “I am looking to all the overseas territories and crown dependencies to continue to work in partnership with the UK in taking the lead on two critical issues: tax information exchange and beneficial ownership.
“I respect your right to be lower tax jurisdictions. I believe passionately in lower taxes as a vital driver of growth and prosperity for all.
“But lower taxes are only sustainable if what is owed is actually paid — and if the rules to achieve this are set and enforced fairly to create a level playing field right across the world.
“There is no point in dealing with tax evasion in one country if the problem is simply displaced to another.’’
The Daily Mail said a Downing Street spokesman commented: “We strongly welcome the Overseas Territories’ positive engagement with our G8 presidency agenda on tax transparency and the significant progress they have made in this area.
“We look forward to welcoming them to our G8 Open for Growth event in the run-up to the G8 leaders’ summit and will continue to work with them and others to agree commitments to advance trade, ensure tax compliance and promote greater transparency.”
Last month Mr Cameron hailed a breakthrough in talks to secure an Europe-wide deal on sharing information to stop multinational firms avoiding paying tax.
The Prime Minister said European Union agreement had been reached on tackling tax evasion and avoidance, after warning countries face ‘staggering’ losses.
Britain’s Guardian newspaper reported: “The intensity of the pressure that Cameron will place on the ten Crown Dependencies and Overseas Territories to be more co-operative has, however, not yet been determined, amide signs there are some disputes between Downing Street and the Treasury on what to demand, and whether excessive public pressure will lead them to refuse to cooperate.
“Cameron wants British offshore havens to sign an OECD convention to give mutual assistance in tax matters, which provides for the sharing of information between countries, seen as key to ending evasion.
“Some of the British havens have agreed to the automatic exchange of information with some western economies, but not as widely as prescribed by the convention.”
The Prime Minister plans to chair a tax and transparency conference alongside Nick Clegg on the weekend before the G8 summit itself.
“Cameron is looking at the possibility of the UK dependencies and Overseas Territories formally signing the OECD convention in the cabinet room on Saturday, but government sources said the plan could yet unravel in the face of hostility from the Overseas Territories,” the Guardian reported.
“The precise constitutional relationship between the UK and the overseas territories is a matter of dispute, but some aid agencies claim the UK can in effect force the Crown dependencies to close down the tax loopholes.”
Melanie Ward, head of advocacy at ActionAid UK, said: “It is perfectly possible to achieve a G8 deal to tackle tax dodging that works in the interests of rich and poor countries alike. The Prime Minister has said that he will do this, but the question is whether he has the clout to achieve it.
“The first test is in the UK’s own backyard, and is whether he will pull all ten of the UK’s own tax havens — the Overseas Territories and Crown Dependencies — into line. ”