The Panama Papers highlight the growing concern that there is one rule for the very rich and another for everyone else. For when individuals and companies manipulate the tax rules to reduce their tax bill, this understandably outrages those ordinary people paying the price of deficit reduction, and businesses who play by the rules. They, reasonably, expect a level playing field. The Panama Papers have destroyed any illusion of fairness in our tax system.However, it goes even deeper than that. For the papers expose the Tories from top to bottom as a party that is not only failing to tackle tax avoidance, but deep down doesn’t really want to either. David Cameron, for example, says he has “some savings” from which he “derives some interest”, but does this mean any of his “savings” come or have come from Blairmore or any offshore tax arrangements at any time? He should just put the record straight rather than try to wriggle around, fooling no one.
The revelations also bring into question the government’s record in tackling tax avoidance and tax havens in particular. The UK has a huge responsibility to deal with this. Many of the tax havens fuelling the problem are British overseas territories or crown dependencies, relying on British financial, foreign policy and security support. Three years ago Cameron promised to get the UK’s own houses in order, but he has failed.
Virtually no progress has been made in ensuring the UK’s overseas territories and crown dependencies meet the UK government’s demands. But then, there is no evidence that the Tories were committed to this in the first place. Since the general election, they have dropped their commitment to public registers of beneficial ownership, despite Cameron claiming two years ago that “making company beneficial ownership information open to the public is by far the best approach”.
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