Senate report urges tough action on offshore havens
The report estimates that US government coffers are light to the tune of between $40bn and $70bn in lost tax revenues of the vast volumes of cash hidden offshore
After 73 subpoenas, 80 interviews and combing through more than two million
pages of documents, a US senate investigations committee has delivered a
400-page report which could prove one of the most chilling documents ever to
confront the world of tax avoidance.
The report estimates that US government coffers are light to the tune of
between $40bn and $70bn in lost tax revenues of the vast volumes of cash hidden
offshore. Offshore havens that find themselves subject of special mention
include the Isle of Man.
The senators, the same ones incidentally who took ‘Georgous’ George Galloway
to task, have recommended a set of sweeping changes including a measure that
would have US tax and anti money laundering laws presume that offshore trusts
and shell corporations ‘are under the control of the US persons supplying or
directing the use of the offshore assets’.
Pulling no punches, the report also points the finger at a number of
individuals for their offshore dealings.
No doubt the report will come as a bombshell in the US which has already been
through the KPMG tax avoidance debacle.
It will certainly heighten the level of government concern about how much tax
revenue is slipping quietly overseas.
Closer to home, the committee’s efforts will no doubt be scrutinised for the
lessons to be learned by our own tax authorities and legislators.
In its detail, near epic scope and depth, the report represents what one
colleague has already described as a ‘masterpiece of forensic investigation’.
If HMRC and the Treasury could persuade the right Commons committee to
undertake a similar project, who knows what gems might be uncovered, and what
support might be drummed up for the chancellor’s anti avoidance campaign.
Will it happen? Commons committees are more poorly resourced than their
counterparts across the Atlantic, and than it itself would mitigate against, for
example, a Treasury committee kicking off its own inquiry.
What it might point to is a very compelling argument for why committees
should be better supported with staff and offices. Perhaps then they really
would find out something worth reporting.