Hundreds of billions of pounds of tax are lost globally every year to tax avoidance.
This is money that should be going into building hospitals and schools, into paying for doctors, and teachers; reducing poverty and improving ordinary lives around the world.
Instead, this money is disappearing into the offshore accounts of the super rich.
It’s hard to know the scale of money hidden offshore. We need more transparency to tackle the problem.
That’s why we’ve been working with the UK Anti-Corruption Coalition.
Our new report highlights a shocking lack of progress from British Crown Dependencies and Overseas Territories towards greater transparency.
A very British problem
Many of these places, like the British Virgin Islands, the Cayman Islands, Bermuda and Jersey, act as secrecy jurisdictions and tax havens.
They function as tax havens because financial flows into their jurisdictions are shrouded in secrecy, benefiting corrupt politicians, gangsters and oligarchs from across the globe.
That’s where we come in. We’re demanding these places publish open registers of who owns the companies in their jurisdictions – and therefore who owns the money stashed in the companies.
Registers of ownership would shine a light on the financial affairs of the super rich who operate in these sometimes tiny jurisdictions. It’s a major step toward tackling global tax avoidance.
It’s the law
In the case of Overseas Territories these registers are not optional, they’re required under UK law (the UK itself introduced such a register back in 2016).
Let me explain. Following pressure from ourselves, anti-corruption campaigners and progressive politicians the Anti-Money Laundering Act was passed in 2018.
It required the UK government to ‘order’ British Overseas Territories to introduce public registers of ownership.
In 2020, the UK government said that it was preparing such orders – and set a deadline of the end of 2023 for these registers to be introduced.
However, little progress has been made.
So far only Gibraltar – one out of the 13 Crown Dependencies and Overseas Territories reviewed – has introduced a publicly accessible register of company ownership as agreed.
This Times piece, which quotes our work, sets out the problem in more detail. This TED talk on the subject is also very helpful.
Our head of advocacy and policy, Rachael, explains the situation in these excellent shareable videos as well.
We must hold them to account
Let’s be clear. International tax avoidance in places like the British Virgin Islands is being enabled by the British government’s failure to act.
Our government’s reticence to enforce its own laws is costing countries and citizens around the world billions of pounds in lost tax revenues every year.
Dame Margaret Hodge MP puts it bluntly in her excellent piece in The Times on Monday:
“Britain has become the jurisdiction of choice for dirty money”.
That should concern and anger us all.