Tax havens invaded: UK offshores open up their databanks
As president of the G8 summit this year, Britain has headed the crusade against those who they don’t feel are paying their fair share of taxes, both individuals and corporations.
"This may be the beginning of the end of bank secrecy havens,” Charles Intriago, the head of the Association of Certified Financial Crime Specialists, said at a G20 meeting in April.
The offshore zones will provide a network of bank account information to Britain, as well as the ‘G5’- France, Germany, Italy, and Spain will also receive automated information.
The information exchange with major EU countries will take place in the coming weeks or months, but will likely provide ‘old’ offshore data, predating the 2008 crisis. Later in 2013 the data will be distributed to tax authorities who will have potential evidence for lawsuits at their disposal.
Information that will be exchanged is names, addresses, birthdays, and other bank account details.
The influx of data will allow British and other authorities to research any individual or company suspected of stashing their money overseas.
George Osborne has called on other countries to remove the "hiding places for those who seek to evade tax and hide their assets."
Tax havens exist worldwide, outside of the EU in Hong Kong as well as Malaysia.
Some of the world’s ‘biggest’ tax havens, in terms of financial assets, are much nearer than the tropical beaches of the Atlantic Ocean. Neighboring Switzerland is a notorious destination for tucking away assets.
Luxembourg, the largest tax haven within the EU, holds about 2.1 trillion euros ($2.73 trillion) in assets. Though yields in Luxembourg and Switzerland are as high as in the BVI or Bermuda, the security puts investors’ nerves as ease.
At an April 19 meeting in Washington, D.C., the G20 agreed to mount pressure on Switzerland, Panama, Guatemala, Trinidad and Tobago, as countries that didn’t meet international transparency standards.
Bermuda and other offshore havens will offer up similar transparency measures to the US.
Bermuda Minister of Finance Bob Richards confirmed Bermuda's intentions to sign the FATCA IGA Model 2 treaty with the UK, US, and G5 countries.
In response, US Treasury official Mark Mazur said: “The US Treasury welcomes this decision by the Government of Bermuda to sign one of the Model Foreign Account Transaction Compliance Act [FATCA] Intergovernmental Agreements. We appreciate Bermuda’s leadership and look forward to helping facilitate an efficient exchange of tax information and strengthening Bermuda’s commitment to global tax transparency,” the Bermuda Sun reported.
