Paradise Papers

Lord Howell of Guildford Excerpts

Monday 6th November 2017 Lords Chamber

[Lord Bates]

Of course it is right that the overseas territories and Crown dependencies take the correct approach on this. That is why the common reporting standard I mentioned—which has just come into effect and on which we led the way through the G7 and various initiatives through that—is coming into effect. That means that the Crown dependencies and overseas territories must inform HMRC about any person from the UK who is registered for tax in the UK but has an account in a different jurisdiction—one of a hundred, including all the overseas territories and Crown dependencies. That is just the type of action we need to ensure that people pay the taxes they are due to pay.

[Lord Howell of Guildford (Con)]

My Lords, of course it is right that companies and entities that operate here in the UK should pay their full weight of tax. However, if the proposition is that all offshore investment is somehow to be disapproved of or stopped altogether, would that not require a return of full capital controls of the kind we had in the distant past, and would it not be a strong disincentive to the inward investment on which this economy strongly relies and a disaster for the UK economy?

[Lord Bates]

My noble friend is right. Indeed the ICIJ, which I mentioned and which released this leak, was keen to point out that it is not suggesting any wrongdoing and that there is legitimate use for these facilities, such as purchasing assets in currencies other than sterling, avoiding double taxation and pooling of investments from different tax jurisdictions. It is important to draw the line between that avoidance and the evasion which we talked about earlier.