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Sunday, June 16, 2013

Some progress on tax, more still needed

The Guardian reports on some progress at the G8 summit on tax evasion but judging by the details there is still much more to be done.

They say that  the Prime Minister has secured agreement from Britain's overseas territories and Crown dependencies that they will sign up to a new clampdown on the practice.

The deal involves a series of actions aimed at promoting transparency and exchange of information between tax jurisdictions so that developing countries will now be able to request information about companies registered in British tax havens, such as the British Virgin Islands and Bermuda.

However, this register will not be open to public scrutiny, giving rise to fears that the developing world will only be able to access information from the tax havens if a specific request is made. The paper says that such a situation would be of little help to countries which do not know where cash that could be taxed in their countries is ending up.

It is an important start, let us hope now that Cameron will be able to build on it to achieve yet more progress towards complete transparency.
"I don't get this" - there is a very easy simple solution which can be imposed to de-program large companies intent on using legal tax avoidance schemes: "flat tax" on gross income - not net income/net profit. There, that was easy. Say 2% tax on gross turnover regardless of stated net profit. Can use a sliding scale, the less stated profit the more flat tax on gross income - not so that companies will avoid selling coffee or running search engine adverts in the UK, but enough to ensure the UK Treasury/citizens get a fair shake. cw

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