New signs that Cayman might dismantle its secrecy law

Cayman: From Paolo Woods' and Gabriele Galimberti's book The Heavens

Cayman: From the tax haven book The Heavens

Cayman politicians love to pretend that they aren’t living in a tax haven. No, they’re part of a responsible international financial centre. And, as we’ve remarked ad nauseam, they all say that. It’s almost a defining feature of tax havens (or, if you prefer to emphasise one important aspect, secrecy jurisdictions.)

Now Cayman has a particularly pernicious piece of secrecy legislation, known as the Confidential Relationships (preservation) Law, under which you can go to jail for up to four years, not only for divulging confidential information, but merely for asking for it. (See Sections 5(1) and 5(2) here if you don’t believe us, then ponder what it would be like to sit in a Cayman jail for four years. Nasty.) We should also add that this is just one aspect of Cayman’s secrecy offerings: scroll down to the bottom here for more details.

Well, now some interesting developments. From Cayman News Service:

“Opposition Leader McKeeva Bush has accused the financial services minister of failing to protect Cayman’s financial services sector because of what he claims are agreements made with the UK and plans to dismantle Cayman’s secrecy law.”

Continue reading “New signs that Cayman might dismantle its secrecy law” →

PwC: using ‘competitiveness’ as crowbar to lobby for mining cos

From Fools’ Gold:

PWCRecently we wrote an article entitled The Ideologists of the Competitiveness Agenda, in which we fingered the Big Four firm of accountants as among the most important vectors for the general idea that countries simply have to ‘compete’ in certain ways: namely, to shower goodies at wealthy people and multinationals, for fear that they’ll relocate elsewhere. As we’ve often argued: that attitude is not just misplaced, but generically harmful.

Now, here’s a recent example of a Big Four firm, PwC, playing the “competitiveness” game, in a lobbying document report purporting to assess the fiscal regimes for gold mining in four African countries.  (Thanks to Mark Zirnsak of Tax Justice Network Australia for pointing this one out.)

Continue reading “PwC: using ‘competitiveness’ as crowbar to lobby for mining cos” →

KPMG: Professional Chameleons Or Independent Public Auditors And Regulators?

A new guest blog by Atul K. Shah, Senior Lecturer, Suffolk Business School, University Campus Suffolk, UK. This is based on a paper Shah first presented at a Tax Justice Network Research Workshop at City University in June 2015, and it follows a more focused piece last month calling for a probe into KPMG: a call that was cited in the Financial Times. Cross-posted with Tax Research UK, slightly adapted.

 

Dr. Atul Shah

Dr. Atul Shah

Guest blog: Professional Chameleons Or Independent Public Auditors And Regulators?

A Case Study of KPMG and its Regulatory Arbitrage Services

By Atul Shah

Recent news regarding tax avoidance and unethical banking cultures are putting an increasing spotlight on the Big 4 Accounting Firms and their independence, professionalism and conflicts of interest. Scholars are beginning to question their huge power and influence in global accounting, auditing and tax, yet little is known about exactly how they practice regulatory arbitrage and the extent to which it is structural and systemic, and how they continue to get away scot free from major financial crises and corporate failures. In the case of the audit failure at HBOS, KPMG have still not been independently investigated eight years after the loss of billions of pounds, thousands of jobs and huge losses for investors, pensioners and retirees. Continue reading “KPMG: Professional Chameleons Or Independent Public Auditors And Regulators?” →

Taiwan – the un-noticed Asian tax haven?

Taiwan flagThis is a speculative blog based initially on a couple of conversations with people in the industry, with some supporting evidence.

A (slightly tidied-up) conversation we’ve just had went along these lines:

“You’ll never guess what is the new Switzerland for Asia. And I mean big time. The Asian money is heading there. Banks set up there as its a financial centre that doesn’t tax foreigners. And its perceived as safe, and not a signatory to the CRS [The OECD’s Common Reporting Standard.] TAIWAN.”

Now, what to make of this?

Continue reading “Taiwan – the un-noticed Asian tax haven?” →

The Finance Curse: Britain and the World Economy, new paper

We’ve pointed to a draft of this before, but here is the final published version, in the British Journal of Politics and International Relations, a paper by two TJNers and Duncan Wigan of the Copenhagen Business School. (It’s also available here.)

Fin Curse

The abstract goes like this:

The Global Financial Crisis placed the utility of financial services in question. The crash, great recession, wealth transfers from public to private, austerity and growing inequality cast doubt on the idea that finance is a boon to the host economy. This article systematizes these doubts to highlight the perils of an oversized financial sector. States failing to harness natural resources for development led to the concept of the Resource Curse. In many countries, resource dependence generated slower growth, crowding out, reduced economic diversity, lost entrepreneurialism, unemployment, economic instability, inequality, conflict, rent-seeking and corruption. The Finance Curse produces similar effects, often for similar reasons. Beyond a point, a growing financial sector can do more harm than good. Unlike the Resource Curse, these harms transcend borders. The concept of a Finance Curse starkly illuminates the condition of Britain’s political economy and the character of its relations with the rest of the world.

This builds on the original Finance Curse document from May 2013, based on Shaxson’s and Christensen’s extensive work in mineral-dependent countries and in financial centres.

We will store this permanently in our Finance Curse page.

Actor Greg Wise takes on the UK tax avoidance industry in Dispatches tonight

 

Actor Greg Wise was so disgusted by the evidence of how HSBC bank  helped its clients evade taxes through its Swiss subsidiary, he got angry, very angry indeed.  So he turned undercover investigator to expose the disgraceful lack of ethics of the tax dodging industry.  As one of the tax dodging adviser explains in the programme: “tax, as I say to all clients, is voluntary.  You can choose how much you want to pay.  Its pretty much down to your moral barometer.”

Greg brings some levity to a subject — and the video will boil your blood.  Watch the programme on Channel 4 at 8 p.m. on Monday 8th February – view the trailer here

Read this to share Greg’s anger about HSBC and the world’s favourite drug cartel.

 

Global Alliance for Tax Justice jumps to top 10 of global rankings

XCongratulations to our partners at the Global Alliance for Tax Justice who have jumped straight in to number ten position in the International Tax Review’s global ranking of who’s who in the tax world.  Continue reading “Global Alliance for Tax Justice jumps to top 10 of global rankings” →

A new whiteboard animation from the Tax Justice Coalition Pakistan

The Tax Justice Coalition Pakistan has just published the following video animation detailing how poor and middle income households in that country carry 75 per cent of the tax contribution, and outlining measures required to restore a degree of progressiveness to what is an increaingly unjust tax regime. Continue reading “A new whiteboard animation from the Tax Justice Coalition Pakistan” →

Tax Haven USA: Congress moves to end corporate secrecy

Caught on cameera

Caught on camera

Earlier this week we blogged a groundbreaking exposé of how US law firms advise on shifting dirty money into the USA.  Now we hear that bipartisan legislation is being proposed to help stamp out corruption, money laundering and tax evasion by curbing use of anonymously-owned companies in America.  Continue reading “Tax Haven USA: Congress moves to end corporate secrecy” →

Civil society calls on African Union to prioritise financing human rights for women

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We’ve just received a copy of the final Communiqué of the 6th Citizen’s Continental Conference which took place in late January in Addis Ababa. This year the conference, which precedes the African Union Summit, had human rights as its core focus, with a particular focus on the rights of women. Continue reading “Civil society calls on African Union to prioritise financing human rights for women” →

Tax Haven USA – part two: Rothschilds (nearly) confirms Tax Justice Network position

City Spy

One year ago, Tax Justice Network published a blog detailing the ways in which the USA is steadily turning itself into a vortex-shaped hole in the global financial system.  Others have picked up on the theme, including The Economist which rightly labelled the USA as “the mega-haven”.  Now, according to London’s Evening Standard newspaper, tax advisers at exclusive Rothschild Trust are (nearly, but not quite) joining the bandwagon. Continue reading “Tax Haven USA – part two: Rothschilds (nearly) confirms Tax Justice Network position” →

Tax Haven USA – part one: 12 New York law firms advise on how to move dirty money to the USA

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12 New York law firms filmed suggesting how to move suspect money into the US & avoid detection

Ground-Breaking exposé by Global Witness shows how the corrupt can exploit anonymously-owned companies Continue reading “Tax Haven USA – part one: 12 New York law firms advise on how to move dirty money to the USA” →

Nigel Lawson, not the corporate income tax, has had his day

xResponding to the UK government’s poor handling of tax negotiations with Google, Nigel Lawson, climate change denier and architect of one of the biggest boom-bust recessions of modern history, has told the Daily Telegraph that the corporate income tax has “had its day”.  Instead he proposes a “much” lower rate with a tax on corporate sales. Continue reading “Nigel Lawson, not the corporate income tax, has had his day” →

Cartoon of the day – on innovation

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Innovation

For a longer read on this kind of thing, try this. And from the same http://artsandhealth.ie/diclofenac/ source as the cartoon, in the context of current news:[/vc_column_text][vc_raw_js]

JTNDYmxvY2txdW90ZSUyMGNsYXNzJTNEJTIydHdpdHRlci10d2VldCUyMiUyMGxhbmclM0QlMjJlbiUyMiUzRSUzQ3AlMjBsYW5nJTNEJTIyZW4lMjIlMjBkaXIlM0QlMjJsdHIlMjIlM0VHb29nbGUlMjYlMjMzOSUzQnMlMjBvZmZzaG9yZSUyMHRheCUyMGRvZGdlJTIwY2FzaCUyMHBpbGUlMjBoYXMlMjBncm93biUyMHRvJTIwJTI0NDNibi4lMjBTZWUlMjAlM0NhJTIwaHJlZiUzRCUyMmh0dHBzJTNBJTJGJTJGdC5jbyUyRmZkRnAzeEVJOVElMjIlM0VodHRwcyUzQSUyRiUyRnQuY28lMkZmZEZwM3hFSTlRJTNDJTJGYSUzRSUyMCUzQ2ElMjBocmVmJTNEJTIyaHR0cHMlM0ElMkYlMkZ0d2l0dGVyLmNvbSUyRmhhc2h0YWclMkZyNHRvZGF5JTNGc3JjJTNEaGFzaCUyMiUzRSUyM3I0dG9kYXklM0MlMkZhJTNFJTNDJTJGcCUzRSUyNm1kYXNoJTNCJTIwSGFyaSUyMFJpcHBlZE9mZkJyaXRvbiUyMCUyOCU0MFJpcHBlZE9mZkJyaXRvbiUyOSUyMCUzQ2ElMjBocmVmJTNEJTIyaHR0cHMlM0ElMkYlMkZ0d2l0dGVyLmNvbSUyRlJpcHBlZE9mZkJyaXRvbiUyRnN0YXR1cyUyRjY5Mjk3NDI1NjY0NTM3ODA0OCUyMiUzRUphbnVhcnklMjAyOSUyQyUyMDIwMTYlM0MlMkZhJTNFJTNDJTJGYmxvY2txdW90ZSUzRSUyMCUzQ3NjcmlwdCUyMGFzeW5jJTIwc3JjJTNEJTIyJTJGJTJGcGxhdGZvcm0udHdpdHRlci5jb20lMkZ3aWRnZXRzLmpzJTIyJTIwY2hhcnNldCUzRCUyMnV0Zi04JTIyJTNFJTNDJTJGc2NyaXB0JTNF

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Europe’s Anti Tax Avoidance Package: adding fuel to the fire?

The European Commission has announced:

“The European Commission has today opened up a new chapter in its campaign for fair, efficient and growth-friendly taxation in the EU with new proposals to tackle corporate tax avoidance. The Anti Tax Avoidance Package calls on Member States to take a stronger and more coordinated stance against companies that seek to avoid paying their fair share of tax and to implement the international standards against base erosion and profit shifting.”

TJN has found the proposals disappointing, to say the least. A TJN statement follows. Continue reading “Europe’s Anti Tax Avoidance Package: adding fuel to the fire?” →

TJN calls on EC to investigate all of the UK’s secret tax deals

Here is the text of a letter of complaint that TJN will be handing in to the European Commission at its office in London this afternoon.

On 23rd January 2016 the UK Chancellor of the Exchequer, George Osborne, tweeted from Davos that the UK Government had struck a deal with Google over its past tax liabilities.  The deal was disclosed at the specific request of Google.

TJN is concerned that deals have been secretly struck with by HM Revenue & Customs with other companies which have not been disclosed to the public.

We are therefore calling on the European Commission to investigate the Google deal, and also to investigate other so-called sweetheart deals with multinational companies that have not been publicly disclosed.

Read our letter below

Continue reading “TJN calls on EC to investigate all of the UK’s secret tax deals” →

TJN calls for public country by country reporting. A few hours later . . .

This morning Alex Cobham, TJN’s Director of Research, called for public country-by-country reporting, in an interview with the BBC’s flagship Today programme (19:20ish).

“Country-by-country reporting: that was actually a Tax Justice Network proposal, going back to our establishment in 2003; but the key to it is for that information to be public: if tax authorities have it, that helps them. But we need to be able to hold tax authorities to account: to know, for example, if HMRC [the UK tax authority] is treating Google fairly.”

What do you know? A few hours later, also on the BBC:

Public country by countryWe’ve got lots more to say on this, of course, but for now we’ll just ask this: can the timing be a coincidence?

More on country by country reporting here.

Endnote: we’ve blogged Google twice in the last couple of days: see Prof. Sol Picciotto’s more wonkish blog, and our more sweeping earlier one, looking at the economic illiteracy of the Mayor of London.)

And as an update, we’re launching an official complaint at the EU about all this. 

Alex Cobham, TJN's esteemed Director of Research

Alex Cobham, TJN’s esteemed Director of Research

 

Taxing Google (and Facebook, Twitter, Uber and the rest)

solGuest blog from TJN senior adviser Professor Sol Picciotto

The announcement of the deal struck by Google with Her Majesty’s Revenue and Customs (HMRC) has aroused much speculation. The term ‘permanent establishment’ has even been mentioned in some august media outlets, such as the Financial Times. These are waters which have been deliberately muddied, so let’s see if we can clarify what is going on. Continue reading “Taxing Google (and Facebook, Twitter, Uber and the rest)” →

Tax haven USA: new Bloomberg story adds urgency to reform needs

FSI USABloomberg is running a story entitled The World’s Favorite New Tax Haven Is the United States, which closely follows the line that TJN has been taking, particularly since our big Loophole USA blog a year ago, and our subsequent USA Report for the Financial Secrecy Index last October.

Expanding on a quote we used in our USA report and in our more recent call for Europe to apply withholding http://artsandhealth.ie/accutane/ taxes to counter the new global threat emanating from the United States, Bloomberg cites:

“How ironic—no, how perverse—that the USA, which has been so sanctimonious in its condemnation of Swiss banks, has become the banking secrecy jurisdiction du jour,” wrote Peter A. Cotorceanu, a lawyer at Anaford AG, a Zurich law firm, in a recent legal journal. “That ‘giant sucking sound’ you hear? It is the sound of money rushing to the USA.”

Continue reading “Tax haven USA: new Bloomberg story adds urgency to reform needs” →

2016 Tax Justice and Human Rights Essay Competition

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Tax Justice Network and Oxfam are joining together to launch a tax justice and human rights essay competition for legal students and professionals. With tax justice rising up the human rights agenda, we want to hear your ideas on how human rights law can be used in the fight against tax dodging. Continue reading “2016 Tax Justice and Human Rights Essay Competition” →

Google’s taxes and the economic illiteracy of the Mayor of London

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Courtesy of Uncounted

Courtesy of Uncounted. (Answer: $100 billion)

No, not the Lord Mayor of London, but the Mayor of London, a certain Boris Johnson, who’s frequently tipped to be Britain’s next Prime Minister. Given that Britain is arguably the most important player in the global offshore system, this man’s opinions deserve close scrutiny.

The topic at hand is Google’s tax affairs in the UK, and the UK government’s triumphant widely derided announcement that Google would be paying an extra £130 million in back taxes over the last 10 years.

At £13 millionish per year, anyone could tell you that that isn’t enough. And some calculations have been made, as Uncounted summarises: Continue reading “Google’s taxes and the economic illiteracy of the Mayor of London” →

The January 2016 Tax Justice Network Podcast

In our January 2016 Tax Justice Network podcast:

What’s Scotland got to do with the plunder of Moldova? We take a look at the ‘Wild West’ of Scottish Limited Partnerships. Also, we discuss the tensions in the EU – is the net finally closing on multinational companies, the tax minimisation deals they’ve been getting from various European countries and the big four accountancy firms who advised them? Just how bad was the sell off of one of Colombia’s most profitable power generation companies? What’s former UK Prime Minister Tony Blair got to do with it? And why’s it been ignored outside Latin America? Also, we talk about the MEP who’s dragging the European Commission through the courts to get access to papers they’d rather we didn’t see. The Tax Justice Network’s John Christensen will eat his hat if they DON’T reveal what MEP Fabio De Masi suspects they will: ‘systematic political backup for a tax avoidance cartel that costs taxpayers in the EU hundreds of billions of dollars annually.’

 

“when you hear Cameron claiming Britain’s leading the world in tackling corruption, it’s beyond a joke.”

Ian Fraser, finance journalist and writer

“it is a bad look for the city of London and the UK, we are supposed to be democratic and free of corruption and yet here we are facilitating…you know, we are hosting some of the most egregious and destabilizing corruption you could possibly imagine”

Richard Smith, finance journalist and blogger at Naked Capitalism

“Europe has to change itself…If they want to prevent corrupt capital to flow into the EU they can do this… and it looks like it’s for the benefit of the developed countries to receive proceeds of corruption though they seem not to be corrupt themselves and I think it’s not right.”

Daria Kaleniuk, Anti-Corruption Action Centre in Ukraine

Featuring: The Tax Justice Network director John Christensen, Daria Kaleniuk of the Anti-Corruption Action Centre in Ukraine, Finance journalist and writer Ian Fraser @IanFraser, and finance journalist and blogger at Naked Capitalism Richard Smith @ncsmiff

Produced and presented by @Naomi_Fowler for the Tax Justice Network. You can follow @TheTaxcast on twitter and subscribe to the Taxcast either on our youtube channel or email naomi[at]taxjustice.net. Also available on iTunes.