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FINANCE

Britain clinches deal on tax havens

Overseas territories sign up to information-sharing protocols as group posts database of offshore entities that could be used for evasion

PUBLISHED : Sunday, 16 June, 2013, 12:00am
UPDATED : Sunday, 16 June, 2013, 6:51am

Britain clinched a deal with its major offshore tax havens yesterday that will see 10 British overseas territories and crown dependencies sign up to international protocols on information sharing.

It came as the International Consortium of Investigative Journalists posted online a massive database of private offshore banking entities that could be used for tax evasion.

The group that first reported the files said anyone can now search the records of some 100,000 companies, trusts and funds located in leading tax havens to see who could be making use of them to skirt home-country taxes.

The group said it also hoped that crowd-sourcing the files would lead to more revelations about public figures who hide their money.

In London, British Prime Minister David Cameron heralded the agreement as a "positive step forward".

"I commend their leadership and I look to other international partners to work with their own territories to reach similar agreements," he said, adding that the deal was a "very positive step forward" that would strengthen Britain's voice in the G8 and its campaign on the issue around the world.

"At the G8 I'm going to push for international agreements to fight the scourge of tax evasion and aggressive tax avoidance."

It also means getting companies to report to authorities where they earn their profits and where they pay their tax, plus transparency about who owns which companies and who benefits, Cameron said - all moves Britain's territories and dependencies supported by signing onto the initiative.

Those included were Bermuda, the British Virgin Islands, the Cayman Islands, Gibraltar, Anguilla, Montserrat, Turks and Caicos Islands, Jersey, Guernsey and the Isle of Man.

The release comes ahead of the G8 summit next week, where leaders of the world's top economies will discuss a pact on sharing banking data to allow countries to fight tax evasion.

The ICIJ, which first revealed it had the huge cache of computerised files last year, has already prompted investigations into tax dodging in a number of countries, including Greece, India, the Philippines and South Korea.

ICIJ director Gerard Ryle said: "Opening up the records serves the public interest by bringing accountability to an industry that has long operated in the shadows."

The ICIJ said it did not put all of the data it has online. It stripped out personal information like e-mail addresses, bank account numbers and phone numbers. Some information on the location of offshore entities has also been held back. Nor is there any financial information in the records, such as capital of the entities or profit and loss data.

The data is heavily focused on Asia and Asians, and Singapore-based or linked entities, especially wealth manager Portcullis TrustNet.

A search for Hong Kong entities on the list brought up names including that of the Hong Kong Community Chest, Red Cross of Hong Kong and Deutschce Bank. The true identity of the names on the list could not be verified.

The appearance of the names was no proof of wrongdoing, the ICIJ acknowledged. "There are legitimate uses for offshore companies and trusts, and ICIJ does not suggest or imply that the people and companies included in the database have broken the law or otherwise acted improperly."

It stressed instead that the database can help develop pictures of offshore networks that can be used to hide money.

Associated Press, Agence France-Presse

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KwunTongBypass
When do we see the USA doing the same with Delaware?
rpasea
Can anyone explain why the Community Chest or Red Cross would need an offshore account in a tax haven? Something to hide?
XYZ
That's a good question. I'll look forward to hearing the Community Chest's answer.

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