19 October 2016 - MPs today paint a damning picture of how British companies and tax havens are helping the corrupt to steal vast sums from poor countries and so undermining UK aid, in a new report welcomed by Christian Aid.
“It is clear from the evidence we received that companies and individuals in the UK, Crown Dependencies and Overseas Territories play a major role in facilitating global corruption,” says the report by the cross-party International Development Committee.
Simon Kirkland, UK Parliamentary and Political Adviser at Christian Aid, said: “MPs are absolutely right to focus on the shameful role that some UK tax havens play in global crime – and to show the devastating impact that corruption has on the lives on people in poverty.
“The MPs call on Theresa May’s government to use ‘the full weight of its influence’ to persuade UK tax havens to end the secrecy around who really owns the myriad companies they host.
“Christian Aid would go further – because the evidence of the last few years is that lobbying the likes of the British Virgin Islands simply does not work, even if you are the UK Prime Minister.
“Theresa May has repeatedly stressed the importance of paying tax in a civilised society, and of businesses not using tax havens. Now is the time to turn that rhetoric into reality – and today’s report provides a ready-made action plan.”
Mr Kirkland added: “Our view is that the UK government does have the constitutional power to impose change on its tax havens, as it has in the recent past in other corruption cases. After three years of delaying tactics from our tax havens, it’s time for the Government to insist on full transparency.”
As the MPs’ report points out, roughly half of the 113,000 companies which featured in the Panama Papers were registered in the British Virgin Islands – a UK tax haven. Two thousand UK-based intermediaries were also revealed, “making the UK second only to Hong-Kong for the number of facilitators of tax evasion and avoidance that it hosts”, the MPs said.
Christian Aid believes the Government could use its recently published Criminal Finances Bill to increase financial transparency in UK tax havens. The Bill includes some other good measures but without this, it cannot claim to be effectively tackling corruption.
The charity also warmly welcomed the MPs’ call for the UK government to use its power to require multinationals to publish currently secret information about their operations in each country where they work, such as their profits made and taxes paid. The move would help to curb rampant corporate tax dodging in poor and rich countries alike.
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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, see here.