Labour’s ultimatum to tax havens
Ed Miliband has warned the tax havens costing British families and businesses billions of pounds that they will have just six months to put their house in order and open their books – or face being placed on an international blacklist.
He has highlighted figures showing that, despite David Cameron boasting more than 18 months ago that he had forced tax havens to open up, not one of the tax havens linked to Britain as Overseas Territories or Crown Dependencies has yet delivered on Cameron’s promise that they would publish a register showing who owns the companies registered there – and some have explicitly refused to do so.
The lack of leadership shown by the UK government has frustrated and slowed the pace of reform on tax avoidance across the world.
In a letter to heads of government, Mr Miliband served notice on them that that under the next Labour government they will have six months to publish publicly-accessible central registers of beneficial ownership.
If they fail to meet this deadline, the next Labour government will withdraw the protection they get from international scrutiny and ask the Organisation for Economic Co-operation and Development to place them on its tax haven blacklist.
In an interview with the Guardian newspaper, Mr Miliband said: “More than 18 months have passed since David Cameron promised to shine a light on the tax havens in UK overseas territories and Crown Dependencies – and their affairs are still shrouded in darkness. That may be good enough for him, but it will not satisfy me, or the incoming Labour government.
“There is nothing pro-business about defending tax avoidance. The United Kingdom has a responsibility to open up the Overseas Territories and Crown Dependencies which are held responsible for so much tax secrecy and avoidance.
“And it is costing everyone who relies on our schools, our hospitals, our roads and our railways. It is costing everyone who pays their fair share of taxes, including millions of British businesses.
“Billions of pounds are being siphoned off into tax havens where our authorities cannot discover even the true ownership of firms registered there, let alone the scale of wealth hidden away.
“Today, I am putting these tax havens on notice that they will have just six months to open up their books or face international sanction.”
In a speech to the Labour Local Government Conference in Nottingham, Mr Miliband also said: “When you are working every day in your communities to deliver services, you are being let down by a government that operates one rule for those at the top and another rule for everyone else.
“Today, we have a government planning real cuts in spending on schools but one that only postures—and does not act over the scandal of tax avoidance.
“Let me say to the Prime Minister: It is not pro-business to defend tax avoidance.
“Britain is losing billions of pounds in lost revenue that could be invested in our future. It is costing everyone who pays their fair share of taxes, including millions of British businesses.
“Businesses and working people who pay their taxes, do the right thing and play by the rules are affronted by tax avoidance – and they are fed up with a government that has failed to act.”
He said: “The current Conservative leadership have become the political wing of offshore hedge funds.
“Unlike them, we will not stand by.
“We will ensure a country where everyone plays by the rules, from top to bottom – and we need to do so much more to restore the basic bargain of our country.”
This is a brilliant move by Labour. It is a promise to make tax avoiders pay what they owe, and restore balance to a tax system in which the Conservatives have placed too much of the burden on the poor.
With more tax coming in from those who are able to pay more, it follows that there will be less need for cuts – and claims that Labour are a party of austerity will be proved unfounded.
You see, Labour is only planning £7 bn of cuts because it sees that current tax revenue is not enough; the Tories want to make £50 bn of cuts because they don’t want the state to provide any services for people who can’t pay a relative fortune for them. There’s a big difference between them.
Is it too much to hope for a positive Labour announcement on welfare benefits next?
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Mike a positive move which needed addressing years ago but DC is too lily-livered to take action as they probably receive numerous donations from the multinationals.
Albeit too late for me I’ve already been abandoned by this shower despite forty years paying NIC and considerable taxes but I will survive not to the level I wanted. However I know there are millions who want to support ED but they need to know what their mere existence holds for them. I do wish he can see the light before its too late.
Given Rachael Reeves’ recent statement it’s not doing Ed any favours.
He’ll need to get shot of Reeves to meet that last point Mike, but for once I agree, he has hit upon something here, he just needs to make as big a song and dance about it as he does the NHS – it’d undermine the trust Cameron enjoys on the economy and could lead to more people rallying behind Labour.
Again it all comes down to whether people feel they can trust the party of whether the spectre of New Labour is still too fresh in people minds….Blair has scarred the party’s reputation and likely will do for some years yet, though I think when half the crookedness of the coailtion comes out in turn, the tories will be finished for decades if not for good. I’d like to hear more on his plans to reform the broken electoral system but I fear he thinks it still benefits his party too much to change it….I know he’s said he’s open to it but again, its that trust issue….
Everybody knows my opinion of Rachel Reeves, of course – even Rachel Reeves!
The Cayman Islands are one of our territories. We should seize all the bank accounts and if they want their money back the account holders will have to prove it’s theirs and legitimate. It’s estimated that $20tn is syphoned through tax havens. We should have enough unclaimed money to pay off the national debt.
Rupert Murdoch will be f***ing furious. This makes me happy. The shills and apologists for big business will be allover the internet, saying it’s not fair that the top 1% pay more than half the taxes, neglecting to mention how much money these parasites actually ‘earn’ from the hard work of others r that as a percentage of income, the poorest pay far more…