MPs call for more tax transparency

MPs call for more tax transparency

MPs, including Dame Margaret Hodge, have called for new transparency measures to tackle tax avoidance in overseas territories.

Following the release of the Paradise and Panama Papers, which exposed the offshore tax affairs of many celebrities and other public figures, Dame Margaret, former chairman of the Public Accounts Committee, is planning to table a cross-party amendment after the second reading of the sanctions and anti-money laundering bill.

The amendment would force the UK's crown dependencies and overseas territories to publish registers of the true owners of offshore companies.

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However, tax lawyer Miles Dean, managing partner of Milestone International Tax, said that Dame Margaret  "needs to provide more evidence to support her assertion that the automatic exchange of information isn't working" before trying to introduce more transparency measures.

Mr Dean said: "The Common Reporting Standard is only just being rolled out and whilst it will be many months until the effects are fully felt, there are behavioural changes being seen across the tax advisory profession and the offshore financial services sector.

"The desire for transparency whereby an individual's right to privacy is totally eroded serves only for petty political point scoring. Public registers of ownership aren't the answer because the scandals which the likes of Margaret Hodge would like to exist simply don't, as the Paradise papers very clearly showed."

However, Scott Gallacher, IFA from Rowley Turton, said the new measures would help to shore up confidence in the tax system.

He said: "I really can't see any argument against greater transparency. The man in the street thinks it is OK to pay cash in hand because companies and others are seen to be involved in various schemes. More transparency would make it much better."