UK To Set Up Central Tax Register

http://www.ft.com/cms/s/0/4cc97bdc-d50f-11e2-9302-00144feab7de.html#ixzz2X2GDwrSe By George Parker, Jim Pickard and Vanessa Houlder Britain is to lead by example in its push for greater tax transparency by setting up a new central register to try to ensure that the true owners of shell companies – often located in tax havens – pay their taxes. David Cameron hopes to persuade other big economies to set up similar registers when he chairs the G8 summit in Northern Ireland next week, a move designed to recover the billions of pounds in lost revenue suffered by exchequers around the world. On Saturday he promises that Britain will set up a register – to be maintained at Companies House – which would initially be available only to relevant authorities including Revenue & Customs. Campaigners for greater tax transparency want the registers of “secretive companies in secretive locations” to be made public, but Mr Cameron told The Guardian that Britain would not go down that route for now unless other countries did the same thing. “I am sure that is where I would like to end up, but I do not want to disadvantage Britain by doing something others won’t do,” he said. “I don’t also want to give up our leverage on others by trying to make them move at the same time.” Under the changes, companies registered in Britain would come under a legal obligation to obtain and hold adequate, accurate and current information on the ultimate owner who benefits from the company. Meanwhile Mr Cameron has been told by the head of one of the UK’s Caribbean dependencies to sort out tax avoidance in the City of London before he lectures Britain’s overseas territories on the issue. The comments from Hubert Hughes, the 79-year-old first minister of Anguilla, will raise doubts over whether the prime minister will be able to achieve unanimous support for a new deal on tax evasion. Mr Cameron wants to nail the agreement ahead of next week’s G8 summit and has organised a pre-summit meeting at Lancaster House, London, on Saturday with leaders of the British Overseas Territories and Crown Dependencies Mr Hughes, speaking to the Financial Times at a Whitehall hotel, said that, although he backed the spirit of a new deal on tax evasion, the overseas territories had not been given enough time to sign up to a new multilateral deal on tax. “I’m worried about the fact that we are being accused,” said Mr Hughes. “This is very hypocritical as we are being compliant … I think the City of London needs to put itself in order. I always consider the City as the biggest money-laundering centre in the world.” Mr Hughes has written to Mr Cameron saying Anguilla was prepared “in principle” to support the multilateral convention on tax. But the letter says: “Before we are able to support this convention we have serious questions about its implementation and in particular the resourcing of such an agreement in Aguilla.” The island would only support the deal if it received assurances from the government that these concerns were resolved, he wrote. Anguilla, in the Lesser Antilles, which is just 13 miles long and has a population of 13,000, is renowned for its white sandy beaches and minimal tax rates. Mr Hughes said that his island had already signed 17 bilateral “exchange of information” agreements with other countries. His comments come after the premier of Bermuda, Craig Cannonier, warned earlier this week that he needed clarification from London before he would sign up to the convention on mutual tax assistance. This treaty would allow future talks on helping authorities, particularly in developing countries, to track down tax cheats. Within hours, however, Mr Cannonier publicly shifted his position. “Bermuda is in active discussions with the UK government over Bermuda’s concerns with some of the provisions in the proposed Multilateral Convention Agreement,” he said. “It is wrong to rule out the possibility of agreement before the G8 as implied by the headlines.” It is understood that a Foreign Office minister, Mark Simmonds, had personally telephoned Mr Cannonier within hours of his arriving at Southampton and persuaded him to reverse his earlier position. But the Bermudan prime minister said he still had concerns about “costs, security of data and treaty duplication” that needed to be addressed before he signed up. Campaigners have been putting pressure on Mr Cameron to secure agreement from the Overseas Territories, saying he risks personal embarrassment if they do not sign the treaty having raised the stakes by his public call to “get our own houses in order” before the G8 summit. The Cayman Islands told Mr Cameron last week that they were prepared to commit to joining the convention, but “looked forward to further discussions on the particulars of the convention’s extension to the Cayman Islands, as balanced with the UK’s recognition of our fiscal autonomy.” This week, the British Virgin Islands told Mr Cameron that it would commit “in principle” to joining the multilateral convention. The three Crown Dependencies – Jersey, Guernsey and the Isle of Man – have also committed. But some jurisdictions resent what they see as arrogance and neo-colonialism from Downing Street. The stakes are high with Mr Cameron wanting to come away from the G8 with an agreement over either tax or free trade, where France is blocking a comprehensive EU-US trade deal. Taylor Scott International