Tax Avoidance and Evasion

Wes Streeting Excerpts

Tuesday 14th November 2017 Commons Chamber

[Mr Andrew Mitchell (Sutton Coldfield) (Con)]

I draw the House’s attention to my entry in the Register of Members’ Financial Interests.

I congratulate the right hon. Member for Barking (Dame Margaret Hodge) on securing this debate. She brings great expertise and authority on these matters, not least from her time on the Public Accounts Committee.

The most important point for the House to focus on this afternoon is that this is absolutely not a party political issue. Although the right hon. Lady raised some criticisms of this Government, she also raised criticisms of the Government of which she was a member. In my judgment, the only plausible criticism that can be made of the current Government is that they need to speed up some of the initiatives they have already implemented. They have not done so in respect of the overseas territories because, obviously, we would rather those havens took action themselves—to be fair, to some extent they have already started to do so.

On the actions taken by the Government, David Cameron and George Osborne led the international effort at the G8 to clamp down on such matters, particularly tax avoidance and evasion. The UK introduced publicly accessible registers of people with significant control, abolished bearer or anonymous shares and, importantly, introduced unexplained wealth orders. The anti-bribery law, work on which first started under John Major in Paris in 1995, was finally introduced in this country by David Cameron in 2011, after 13 years of Labour government.

On this Government’s record, let us be clear that they have been taking action and have raised an immense amount of extra tax as a result. However, the time has come—this is my third debate on this issue—to insist on the same levels of openness and transparency for the overseas territories as we have in this country. The territories gain hugely from their relationship with the United Kingdom and, as the Government made clear in 2012,

“As a matter of constitutional law the UK Parliament has unlimited power to legislate for the Territories.”

[Wes Streeting (Ilford North) (Lab)]

The right hon. Gentleman will know from his considerable expertise on international development that the abuse of such offshore schemes not only harms British taxpayers but disadvantages some of the world’s poorest people. That is why the Government must act to introduce greater transparency in Crown dependencies and overseas territories.

[Mr Mitchell]

I am coming on to precisely that point.

Like many Members, I have been visited by senior Ministers of almost all the overseas territories, and the position of the territories is best summed up by the prayer of St Augustine: “Oh Lord, make me chaste—but not yet.” The territories put two specific arguments. I call the first the Dutch Antilles argument, which is that if the territories have open registers, the hot money will head off to the Dutch Antilles. There is momentum around the world, thanks to David Cameron and George Osborne, to attack such ills and unfairnesses. Havens that embrace an open register will get an advantage from being at the front of opening up to billions of pounds of legitimate business.

The second argument—in a way, this is the one we have to address head-on—is that the territories’ private registers are already available to lawmakers and regulators, such as HMRC. The territories proudly say that they will turn round inquiries from HMRC within a matter of hours, which is good, but it completely misses the point, as the recent release of information shows. Registers must be open to the media, to journalists, to non-governmental organisations and to those who can join up the dots. The regulatory authorities, with the best will in the world, are not in that business. Narrow questions, drawn from regulatory authorities, simply do not begin to suffice.