LDF and Swiss-UK Tax Agreement
1.5.2 Overseas Territories and Former Overseas Territories
Due to the Offshore Leaks?, the UK and its overseas and former overseas territories were seen as a
major issue in the global tax evasion structure. * The UK has no interest in terminating its tax haven
network, which consists of three crown dependency islands, the Isle of Man, Jersey and Guernsey, and
14 overseas territories.?? The most successful of these is the British Virgin Islands, where more than
one million offshore entities are incorporated.’ It is a global centre of the offshore industry with
branches, agents and solicitors from UK finance companies. The island is self-governed, but with a
British governor under the jurisdiction of the UK.”
The financial network of the overseas territories and the UK homeland is seen as a geographic ad-
vantage and is important for the City of London, the heart of the British financial industry? Further-
more, if the islands were not able to generate public revenue, the UK might have to financially assist
them.? Despite this, the UK government has recently concluded an agreement with the Isle of Man
based on Foreign Account Tax Compliance (FATCA) and explained that further overseas territories
will follow.!9?
Richard Murphy, director of Tax Research LLP and Tax Gap Limited and senior advisor of the Tax
Justice Network, lists 18 starting points to tackle tax haven abuse in UK territories. He recommends,
amongst other things, further (multilateral) Tax Information Exchange Agreements (TIEA) with an
improved standard and automatic exchange. Furthermore, he supports the abolishment of the UK dom-
icile rule and he is involved in establishing a Register of Trusts in the style of the Register of Compa-
nies for all UK territories. '?!
Because of the pressure on Austria over its banking secrecy, the financial minister, Maria Fekter, has
stated that Great Britain is a tax and money laundering paradise and Great Britain would have to abol-
? International Consortium of Investigative Journalists, 2013.
?' Ball, 2013.
?5 Zeit Online, 2013.
% Leigh, 2013.
7 Ball, 2013.
% Zeit Online, 2013.
? Volkery, 2013.
19 Watt, 2013, p. 15.
1! Murphy, 2011, p. 5 & 6.
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