Owners' database set up to expose dodgy tax deals
A new UK database of company ownership details, designed to expose international money-laundering and tax-evasion schemes, will be opened to public scrutiny, Prime Minister David Cameron said.
The plan advances Mr Cameron's efforts to push money-laundering and tax-evasion to the top of the global agenda, and follows a debate at the G8 summit of the world's eight wealthiest states in June.
The 'beneficial ownership register' goes beyond existing registration of corporations and shareholders by untangling deliberately opaque ownership structures to help authorities track down those who are using low-tax regimes overseas to illegally reduce their tax bills.
By making the data public, a move taken after consultation with businesses and pressure groups, the Government hopes to put more pressure on firms and individuals seeking to hide wealth and profits.
"A small minority has hidden business dealings behind a complicated web of shell companies... This cloak of secrecy has fuelled all manner of questionable practice and downright illegality," Mr Cameron said at a conference in London promoting open governance.
At June's G8 summit, he was unable to secure agreement from leaders to guarantee they would take similar steps, only a promise they would draw up a plan to provide more data on company ownership.
The question of how much tax corporations pay – especially when the government has imposed cuts on ordinary people to reduce the UK's debt pile – has been highlighted by disclosures that companies such as Starbucks and Amazon pay little or no tax in to British coffers, provoking public and political uproar. Many, like Google, use their operations in Ireland to avoid UK taxes.
While they operate within the rules to minimise their tax burden, it is hoped the new register will shine a light on firms illegally evading paying tax.
Britain's register will hold information on those who have 25% or more of a company's shares or voting rights, or who otherwise control the way it is run, the Government said.
However, Mr Cameron confirmed it would not cover complex trust structures which can also be used for tax avoidance.
Campaigners said that by making the first move with the register, the UK had set a welcome precedent for others.