The UK government has been accused of thwarting Europe-wide efforts to combat money laundering and terrorism by resisting measures to open secretive trusts to public scrutiny.

Under Europe’s fifth anti-money laundering directive, which comes into force next year, member states are supposed to give those with a “legitimate interest” a right to know what assets are owned by trusts and who the beneficiaries are. The Treasury is currently consulting on how it will implement the directive.

Labour says the government’s proposals, published this month, are “extremely restrictive” and will block enquiries by those who should have access to the data, such as journalists, campaigners and the victims of fraud.

Shadow Treasury minister Anneliese Dodds wrote to Philip Hammond on Thursday to urge a rethink. “Investigative journalists have done great work uncovering corruption,” she told the chancellor. “The UK government should not be blocking them from accessing important information.”

In the UK, vast tracts of land and property are controlled and passed from one generation to another using thousands of family trusts. They are used by the biggest landowning families, such as the Duke of Westminster, and by a number of current and former ministers to hold family fortunes.

The Chancellor himself is a beneficiary of the Hammond 2010 Discretionary Settlement, a trust which owns a construction firm. It was established to hold his business interests after he became a minister.

Investigations like the Laundromat series and the Panama Papers have revealed how such vehicles are also used to move and disguise fortunes derived from crime and the proceeds of political corruption.

Trusts are a favoured money-laundering tool because of the secrecy that surrounds them. There is currently no public register listing the names, beneficiaries or holdings of any UK trusts, but the new EU directive is designed to change this.

The tax office currently keeps a register of all trusts that pay UK tax. The new directive means that register will be expanded to cover all trusts, whether they pay tax or not. It will include those with UK resident beneficiaries, settlors or trustees, and foreign trusts that own property in the UK or have business dealings here.

The information will be accessible to law enforcement, to professionals with a duty to make money-laundering checks, such as lawyers, accountants and estate agents, but also, for the first time, to members of the public with a good reason for accessing the information.

However, the government’s consultation paper makes it clear that the Treasury is minded to take a cautious approach to information sharing. Those wanting access will need to already have evidence from another source linking the trust or its beneficiary to money-laundering or terrorism, and that evidence will have to be shared with the government.

Even then, the government reserves the right to refuse to share data if it impedes ongoing law enforcement investigations. Unlike freedom of information requests, the government intends to charge for access to the data. Its consultation paper suggests the charges could be significant, stating: “The government expects to apply fees proportionate to the costs involved in checking and compiling the information.”

In her letter, Dodds said: “This sets the bar far too high and will prevent legitimate investigation into trust structures suspected of use for fraudulent purposes.” The government had adopted “an extremely restricted view” of how such legitimate interest would be interpreted, she wrote. Journalists relying on tip-offs from insiders to identify corrupt individuals would not be able to provide such evidence to government.

“This is unfortunate given it has often been investigative journalists who have led the way in identifying corruption, such as that unveiled by the ‘Laundromat’ cases.”

The Conservatives have been resistant to more transparency around trusts. It was revealed that the former prime minister David Cameron had personally intervened in 2013 to weaken an earlier EU drive to reveal the beneficiaries of trusts, saying they were mostly used for inheritance tax planning and should be exempt from anti-money-laundering measures.

In its consultation, the Treasury has argued for a proportionate approach, saying that a national risk assessment published in 2017 had found that “UK trusts present a low risk of money laundering and terrorist financing”.

A spokesperson for the ministry said: “The UK is internationally recognised as having a strong track record on tackling money laundering. We currently have one of the top ratings in the world on our approach to overseeing beneficial ownership of companies and trusts.”