Offshore tax havens like Hong Kong contribute to poverty, says ActionAid

The widespread use of offshore tax havens such as Hong Kong by nearly all 100 of the largest British-listed companies, including HSBC and Standard Chartered, may contribute to world poverty and raise the risk of tax evasion, says British charity ActionAid.

It found 36 per cent of HSBC's 1,527 subsidiaries are based in tax havens, including 91 HSBC subsidiaries in Hong Kong, while 45 per cent of Standard Chartered's 317 subsidiaries are also in tax havens, including 27 of them in the special administrative region.

Hong Kong is a haven for 523 subsidiaries of FTSE 100 companies such as Glencore International, while Macau is a haven to 12 subsidiaries, ActionAid says.

Reacting to ActionAid's report, an HSBC spokesman said: "HSBC applies the spirit and letter of the law in all territories in which it operates and seeks to comply with the UK Code of Practice for Taxation of Banks."

The bank said it expected its customers to be tax-compliant and did not bank with customers if it suspected or knew clients were evading their tax obligations. "HSBC deals in an open and transparent manner with all tax authorities."

In April, the French government launched an investigation into whether HSBC offered illegal products to help French clients avoid tax in Switzerland.