HAMILTON, Bermuda--King Charles has been urged to take action against Bermuda and other “tax havens” that are “complicit” in global tax abuses.
The call was made by the Tax Justice Network, a group of activists and researchers calling for an overhaul of the global tax system.
In an open letter to His Majesty, Alex Cobham, the chief executive of the group, said: “Regrettably, the financial regulations of Your Majesty’s jurisdictions can be arguably said to pose the biggest non-violent threat in the world to human rights.
“It brings me no pleasure to highlight to Your Majesty – as the Head of State and Sovereign of the Crown Dependencies and Overseas Territories – that the British Virgin Islands, the Cayman Islands, Bermuda and Jersey all rank above Ireland on the Corporate Tax Haven Index 2021, our ranking of jurisdictions most complicit in helping multinational corporations underpay corporate tax.
“Ireland ranks 11th and is immediately followed by The Bahamas in 12th and the United Kingdom in 13th.
“The UK, the Crown Dependencies and the British Overseas Territories are collectively responsible for facilitating nearly 40% of the tax revenue losses that countries around the world suffer annually to profit shifting by multinational corporations and to offshore tax evasion by primarily wealthy and powerful individuals.
“This makes the UK and its network of satellite tax havens the world’s biggest enabler of global tax abuse.
“These tax havens continue to disadvantage their own inhabitants as well as some of the poorest people globally – and, of course, the people of the UK.”
Cobham said he hoped that the King’s coronation, which took place on Saturday, will be “a pivotal moment” in addressing the “heavy financial and human cost” of tax havens.
Cobham said Overseas Territories were “encouraged down the road of tax havenry” after the Second World War, and that Britain now had a duty to reverse the trend.
He said: “Many of today’s British satellite tax havens are an unresolved legacy from that time, having been facilitated to develop as financial and secrecy centres as the British Empire began to change in the 20th century.
“Rather than beginning to pay reparations for the violence, enslavement and extraction of the British Empire, the UK’s ‘second empire’ is continuing to add to the debts that we owe.
“The scale of that debt is almost certainly unpayable. At a minimum, however, the time has surely come to stop the clock running. That means reversing the policies that support financial secrecy and profit shifting, and keep the UK’s second empire as the most damaging actor globally.“
The letter, which was copied to British Prime Minister Rishi Sunak, also condemned Britain for its failure to adopt global practices on financial reporting.
Cobham said: “The EU and Australia are moving ahead to increase transparency in this area while the UK remains resolutely opaque.
“While successive editions of our Financial Secrecy Index show that the world is successfully curbing financial secrecy, the UK sticks out as one of the few backsliders who are dramatically increasing their supply of financial secrecy to the world.
“The overall effect is that the UK’s network of tax havens over which Your Majesty is Sovereign continues to facilitate cross-border tax abuse and other illicit financial flows at global expense. Internationally, the UK is now standing in the way of the march of progress.” ~ The Royal Gazette ~