IT IS ESSENTIAL European finance ministers sign up to an EU directive requiring the automatic exchange of tax information if avoidance and evasion are to be effectively tackled, according to the chancellor.
As part of the UK’s drive to implement automatic exchange of tax information between nations, George Osborne said a popular uptake of the EU savings directive among his opposite numbers is a crucial precondition for the scheme’s facilitation, reports the Guardian.
In a letter to his fellow finance ministers, Osborne urged that they sign off on the deal, which has been delayed by more than a decade.
“Unless Europe can show it can agree on this existing proposal, our commitment to a new, stronger standard will not be credible. It is a test of our seriousness, and the world is watching us,” he wrote.
Automatic information exchange and public registers of company ownership are high on the government’s agenda ahead of the G8 summit in June, which the UK is chairing.
All the UK’s overseas territories with significant financial centres are now signed up to a similar deal with the UK, and are now piloting automatic information exchange.
The deals will see the UK, along with other countries involved in the pilot, automatically provided with much greater levels of information about bank accounts held by their taxpayers in those jurisdictions, including names, addresses, dates of birth, account numbers, account balances and details of payments made into those accounts.
It also includes information on certain accounts held by entities, such as trusts. Under those deals, UK residents with assets concealed on the islands will have until September 2016 to disclose details to the taxman and pay any tax owed to the HMRC, as well as a fine between 10% and 20% of the amount owed.
While in most cases, the deal will see evaders escape prosecution, HMRC offers no guarantees.
Unlike a similar deal with Switzerland, anonymity is not enshrined, while the deals will not have the immunity from criminal prosecution seen in the Liechtenstein Disclosure Facility. The UK received its first payment from Switzerland, amounting to £340m in January.
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