17 August 2016 - Commenting on today’s UK government proposals to fine professionals whose clients aggressively avoid tax, Christian Aid said the move could hit the global tax avoidance supply chain, by increasing the risks facing the accountants, lawyers, banks and others involved.
“Since the UK and its overseas tax havens lie at the core of a rotten global system, it's right for the UK to take decisive action,” said Toby Quantrill, the charity’s Principal Adviser on Economic Justice.
“We welcome the intention of these proposals although we have yet to see the crucial details.
“Tax advisers’ lack of accountability for the damage they inflict on societies is a serious problem, which we have previously highlighted. We are pleased to see this government planning to match its strong words on tax avoidance with action.
“If the government is prepared to resist the inevitable lobbying to water down these plans and to put sufficient weight and political will behind them, then they could be an effective response.”
Mr Quantrill added: “The Panama Papers and other revelations over the past few years have confirmed that tax avoidance and evasion are not just about the actions of particular wealthy individuals and companies – they are supported by a rotten global system.
“That system relies on accountants, lawyers and banks prepared to test the boundaries of legality in order to help their clients slash their tax bills. The UK and its tax havens are world leaders in the provision of such services.
“The system does great damage to people’s lives, not just in the UK but also in the poorest nations. It makes it hard or impossible for governments to provide the education, care, safety and security that their citizens need.
“Tax avoidance deprives societies of billions needed for such public services. It also exacerbates already terrible inequality.”
Commenting further on the government proposal, Mr Quantrill said: “While successful implementation will rely heavily on the definitions used, the potential exists to vastly increase the risks to those involved in the tax avoidance ‘supply chain’ and thus shrink the sector significantly.
“We would like to see the proposals include penalties for UK-based advisors and banks that facilitate tax avoidance schemes elsewhere in the world. This could make a significant impact in countries which struggle to raise the taxes needed to finance development.”
For more information contact Rachel Baird on firstname.lastname@example.org. The 24-hour Christian Aid press duty phone is 07850 242950.
Notes to editors:
1. Christian Aid works in some of the world's poorest communities in around 40 countries at any one time. We act where there is great need, regardless of religion, helping people to live a full life, free from poverty. We provide urgent, practical and effective assistance in tackling the root causes of poverty as well as its effects.
2. Christian Aid’s core belief is that the world can and must be changed so that poverty is ended: this is what we stand for. Everything we do is about ending poverty and injustice: swiftly, effectively, sustainably. Our strategy document Partnership for Change explains how we set about this task.
3. Christian Aid is a member of ACT Alliance, a global coalition of more than 130 churches and church-related organisations that work together in humanitarian assistance, advocacy and development.
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5. For more information about the work of Christian Aid, visit http://www.christianaid.org.uk