The Parliamentary Assembly of the Council of Europe has warned that ‘massive’ offshore tax evasion and avoidance cause ‘serious harm to the public interest’ in Europe and elsewhere, and particularly in developing countries.
The Parliamentary Assembly of the Council of Europe has warned that ‘massive’ offshore tax evasion and avoidance cause ‘serious harm to the public interest’ in Europe and elsewhere, and particularly in developing countries. It recommended a series of reforms, including country by country reporting by multinationals in all business sectors.
Tackling global distortions due to harmful or predatory tax practices was ‘a moral duty and a common cause’, the parliamentarians said in a resolution on tax havens, adopted on 27 April by 51 votes to 11, with one abstention. The Assembly is the ‘deliberative body’ of the Council of Europe, and representatives are appointed by national parliaments.
‘Thanks to growing public outcries, international co-operation has intensified, notably at the G20 level, to tackle the root problems concerning tax havens: bank secrecy, lack of transparency and effective public oversight, regulatory dumping, predatory tax arrangements and abusive accounting techniques within multinational companies (notably abusive transfer pricing),’ the resolution said.
Representing the UK, the Liberal Democrat MP Mike Hancock said it was ‘inexcusable’ that people looked for reasons not to pay their taxes while ‘enjoying the protection and the lifestyle of the country in which they live’.
‘Why do people go to the Cayman Islands and deposit their money there? Is it because they like the tropical beaches? Do they go to Monaco because they want to gamble in the casino? Do they go to Switzerland because they like chocolate? No, the truth of the matter is that they go to these places because they can hide their money away and avoid paying taxes in their countries of origin, where most of that money would have been made,’ Hancock said. ‘Secrecy is an inbuilt reaction in these countries, and that is appalling. My own country is a prime example because we have allowed tax havens to be set up in the Isle of Man, the Channel Islands, the Cayman Islands, the British Virgin Islands, Gibraltar and others, and they persist in these practices.’
The Assembly called for steps to phase out bank secrecy; country by country reporting by multinationals wherever they operate, across all business sectors; a ban on anonymous accounts, off-balance-sheet bookkeeping and bearer shares; disclosure of the ultimate beneficial ownership of all business entities, including trusts and funds; harmonisation of tax practices across Europe and beyond; and a move towards the automatic exchange of all tax information.
The Parliamentary Assembly of the Council of Europe has warned that ‘massive’ offshore tax evasion and avoidance cause ‘serious harm to the public interest’ in Europe and elsewhere, and particularly in developing countries.
The Parliamentary Assembly of the Council of Europe has warned that ‘massive’ offshore tax evasion and avoidance cause ‘serious harm to the public interest’ in Europe and elsewhere, and particularly in developing countries. It recommended a series of reforms, including country by country reporting by multinationals in all business sectors.
Tackling global distortions due to harmful or predatory tax practices was ‘a moral duty and a common cause’, the parliamentarians said in a resolution on tax havens, adopted on 27 April by 51 votes to 11, with one abstention. The Assembly is the ‘deliberative body’ of the Council of Europe, and representatives are appointed by national parliaments.
‘Thanks to growing public outcries, international co-operation has intensified, notably at the G20 level, to tackle the root problems concerning tax havens: bank secrecy, lack of transparency and effective public oversight, regulatory dumping, predatory tax arrangements and abusive accounting techniques within multinational companies (notably abusive transfer pricing),’ the resolution said.
Representing the UK, the Liberal Democrat MP Mike Hancock said it was ‘inexcusable’ that people looked for reasons not to pay their taxes while ‘enjoying the protection and the lifestyle of the country in which they live’.
‘Why do people go to the Cayman Islands and deposit their money there? Is it because they like the tropical beaches? Do they go to Monaco because they want to gamble in the casino? Do they go to Switzerland because they like chocolate? No, the truth of the matter is that they go to these places because they can hide their money away and avoid paying taxes in their countries of origin, where most of that money would have been made,’ Hancock said. ‘Secrecy is an inbuilt reaction in these countries, and that is appalling. My own country is a prime example because we have allowed tax havens to be set up in the Isle of Man, the Channel Islands, the Cayman Islands, the British Virgin Islands, Gibraltar and others, and they persist in these practices.’
The Assembly called for steps to phase out bank secrecy; country by country reporting by multinationals wherever they operate, across all business sectors; a ban on anonymous accounts, off-balance-sheet bookkeeping and bearer shares; disclosure of the ultimate beneficial ownership of all business entities, including trusts and funds; harmonisation of tax practices across Europe and beyond; and a move towards the automatic exchange of all tax information.
