The British PM vowed to end tax secrecy four years ago. Not much has happened – but the Panama Papers may change that

David Cameron has promised to end “tax secrecy” in the UK and has described some offshore schemes that allow people to minimise their tax rates as “not morally acceptable”.

His outspoken comments reflect a change in the political and public mood at a time of enduring austerity – a mood that has been shared by other world leaders under pressure to reform a system that is open to abuse.

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Cameron’s tough line was set out four years ago when he said some offshore schemes were “not fair and not right”. “If you want to arrange your tax affairs so you support your pension, you plan effectively for your family, that is one thing, and that is acceptable,” he said. “But frankly some of these schemes where people are parking huge amounts of money offshore and taking loans back just to minimise their tax rates, it is not morally acceptable. It isn’t morally right to do that.”

In 2013, the prime minister asked fellow G8 leaders, including Barack Obama and Angela Merkel, to sign up to a new set of core tax principles. His goal was to tackle corruption and money laundering that cost exchequers around the world billions in lost revenue.

“We need to shine a spotlight on who owns what and where money is really flowing,” Cameron said at the time. “Some people will question whether it’s right to make this register public … but there are so many wider benefits to making this information available to everyone.

Facebook Twitter Pinterest Angela Merkel, Putin, Cameron and Obama at the G8 summit in 2013. Photograph: Stefan Rousseau/AFP/Getty Images

“It’s better for us all to have an open system which everyone has access to. The more eyes that look at this information, the more accurate it will be. This is a complete world first on transparency and I’m proud Britain is leading the way. And today I call on the rest of the world to join us in this journey.”

The National Crime Agency estimates that hundreds of billions of pounds in international criminal money is “almost certainly” laundered each year through UK banks.

From 2004-14, law enforcement agencies identified more than £180m worth of property bought with corrupt funds, with about 75% purchased via offshore companies. They say this was the “tip of the iceberg”.

In June, the government will introduce a new central register that identifies the beneficial or “significant” owners of UK companies. A beneficial owner is the real owner of a company, even though their name may not appear on the shareholder register. The database wants to extend this principle to offshore firms registered abroad, including in UK overseas territories such as the British Virgin Islands and other tax havens.

But a government consultation paper published in March leaves open the possibility that a central register might be kept in the country in which a firm is incorporated, in effect allowing offshore secrecy to carry on.

Cameron is due to host a major summit to discuss offshore issues in London in May. Campaigners want legislation to abolish all the UK’s tax havens including the crown dependencies Jersey, Guernsey and the Isle of Man.



Panama Papers reporting team: Juliette Garside, Luke Harding, Holly Watt, David Pegg, Helena Bengtsson, Simon Bowers, Owen Gibson and Nick Hopkins