Short urges Belize tax reform
Clare Short, international development secretary, is set to urge Belize to scrap controversial tax concessions which give certain companies tax-free status.
Short will press the central American country to end a 30-year tax exemption currently enjoyed by two companies, one of which is owned by Tory party treasurer Lord Ashcroft.
The move follows a report from KPMG, which was commissioned to investigate the economic effects of the concessions. The Big Five firm was asked to carry out the investigation by the Department for International Development as an extension of an earlier report carried out by the firm last year on the central American country’s offshore financial services.
Officials are now understood to have advised Short that Belize is losing considerable revenue that could be used to reduce poverty in the country.
It has been estimated that Ashcroft’s company, Carlisle Holdings, and financial services group Sonisa have a turnover equivalent to 8.5 per cent of Belize’s gross domestic product.
It is believed the KPMG report sets out three options for tackling the concessions.
One would be to negotiate with the companies to reduce the concession over time, another would be to reduce the scope of the laws by preventing any future acquisitions by the companies from benefiting from the concession.
A third would be to leave the concession unchanged.
A spokesman for the Department of International Develpoment was unable to confirm details of the report.
He said: ‘The contents of the report will first be discussed with the Belize government.’
Short has been accused by Ashcroft of deliberately targeting his company and last week began legal action against the minister and new foreign secretary Jack straw.
Links
Resources & Whitepapers
Accounting Software The power of customisation in accounting systems
KPMG to investigate Belize tax breaks