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Britain Just Passed A Sweeping Crackdown On The World’s Most Notorious Tax Havens (Quartz)
May 1, 2018
From the article:
Britain is forcing many of the world’s most notorious tax havens to reveal their inner secrets, after prime minister Theresa May’s government caved to an opposition amendment that will make the UK Overseas Territories open up their corporate books.
The amendment requires tax havens like the Cayman Islands, British Virgin Islands, and Bermuda to publish registries of who actually owns companies registered there. These islands now provide almost no meaningful corporate ownership information, resulting in abuse by kleptocrats, gangsters, and tax evaders—as found in the Panama Papers leak, where around half the companies exposed were formed in the British Virgin Islands.
...Supporters of the amendment framed it as the first step in making transparent ownership registries the international norm, with the ultimate aim of ramping up pressure on the US to follow suit.
This is a long way from the end of offshore secrecy, however. Investors who want to keep their identities secret will simply up sticks to another tax haven, says Alex Cobham, chief executive of the Tax Justice Network, a pro-transparency advocacy group.
Secretive US states like Wyoming and Nevada will pick up business, he predicted, perhaps along with UK crown dependencies Jersey and Guernsey, which won’t be hit by the legislation. If businesses are happy to move to avoid transparency, it will be tricky to push the US in line with Europe’s wish for corporate ownership registries to become the global norm, says Maya Forstater, a visiting fellow at the Centre for Global Development: high levels of secrecy will become “a competitive advantage for US jurisdictions.”