New global rules on firms’ tax disclosure urged by economists – BBC News | The Knowledge Dynasty

New global rules on firms’ tax disclosure urged by economists – BBC News

Image copyright Reuters
Image caption Poor countries are the biggest losers from tax havens, the group of 300 economists claim

New global rules forcing companies to report taxable activities country-by-country publicly have been called for by a group of 300 prominent economists.

In a letter to world leaders, the group urges the UK to “take a lead” in the push for more tax transparency.

Poor countries are the biggest losers from tax havens, they claim.

The letter’s signatories, co-ordinated by charity Oxfam, include best-selling author Thomas Piketty and 2015 Nobel Prize economics winner Angus Deaton.

The letter comes ahead of the UK government’s anti-corruption summit on Thursday, which politicians from 40 countries as well as World Bank and IMF representatives are expected to attend.

The economists – who include almost 50 professors from British universities including Oxford and the London School of Economics – argue the UK’s position as summit host as well as its sovereignty over what it says is a third of the world’s tax havens makes it “uniquely placed” to take the lead.

Image copyright Thinkstock
Image caption The economists want public country-by-country reporting on taxable activities

“We need new global agreements on issues such as public country-by-country reporting, including for tax havens.

“Governments must also put their own houses in order by ensuring that all the territories for which they are responsible make publicly available information about the real ‘beneficial’ owners of company and trusts,” the economists write in the letter.

The letter comes in the aftermath of the Panama Papers leak, which revealed how some rich people hide assets, sparking widespread condemnation that the authorities had failed to act.

‘Deeply damaging’

Oxfam said that more than half of the companies set up by Mossack Fonseca, the law firm in the Panama Papers leak, were incorporated in British Overseas Territories such as the British Virgin Islands.

“As long as British-linked tax havens continue to help the rich and powerful get away with dodging tax it will remain deeply damaging to the UK’s credibility as a leader in the fight against corruption and global poverty,” said Oxfam chief executive Mark Goldring.

Last month, tax and law enforcement agencies in the UK, Germany, France, Italy and Spain agreed to share data in a new crackdown on international tax dodging.

Under the deal, the five nations will exchange information regarding beneficial ownership registers, which show who really owns assets.

However, only the UK has so far committed to making this information public.

Registers or “similarly effective systems” will be introduced in UK overseas territories, but are expected to be open to enforcement agencies, not to the public.

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Read more: http://www.bbc.co.uk/news/business-36243862

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