Plans to stop money laundering, illegal tax evasion and corporate tax avoidance have been agreed upon at the G8 Leaders’ annual Summit in Northern Ireland, where Heads of State and Government of member countries are meeting to discuss and attempt to reconcile global issues, the BBC reported today.
Designed to fight illegal evasion of taxes, as well as legal tax avoidance by large corporations that make use of loopholes and tax havens, the measures include an agreement by participating Governments to provide automatic access to information on their residents’ tax affairs. Also, in order to prevent aggressive tax avoidance, shell companies, which are often used to exploit tax loopholes and make anonymous investments, will be required to establish the identity of their effective owners.
Following disclosures about the ways in which certain large firms such as Google, Apple, Starbucks and Amazon have minimised their tax bills, the G8 summit agreed that multinational companies should be required to inform all tax authorities about how much and where they pay their taxes. Illegal activities, including tax evasion and money laundering, will be tackled by automated sharing tax information.
Plans for a UK register of companies and their owners where revealed today by UK Chancellor George Osborne, while the US Government also announced a similar plan. Osbourne is quoted as saying: “I think we have probably made more progress in the last 24 hours than people have made in at least 24 years”.
The BBC added that mining firms will be asked for more transparency, as a large number of major mining companies use complex ownership structures in the Netherlands and Switzerland to avoid paying taxes on the minerals they extract in developing countries.