Taxman eyes up Virgin Islands and Panama

Hot on the heels of the breakthrough agreement with Switzerland HMRC is now attempting to get a similar agreement with other so-called tax haven jurisdictions, in particular the British Virgin Islands and Panama.

Accountancy Age reports that a senior official at HMRC has informed them that talks are now going on with the British Virgin Islands and Panama, with a view to getting a similar deal to that brokered with Switzerland recently. Under that deal British citizens with accounts in Switzerland will have to do disclose, or face hefty withholding taxes. HMRC will also be given significant access to information on hundreds of accounts each year held by UK residents in Switzerland.

The report that HMRC are in serious negotiations with other tax haven countries comes as no surprise. In the last 12 months HMRC has entered into over 20 tax information exchange agreements with countries that had previously been regarded as impenetrable tax havens. They have now entered into information sharing and disclosure agreements with Liechtenstein and Switzerland; both previously regarded as bastions of secrecy. Panama and the BDI are now being particularly targeted because they have thriving company and Foundation formation services businesses, but have a minimal level of public reporting.

David Gauke, Exchequer Secretary to the Treasury, said: “The message is clear: there is no hiding place for tax cheats.”

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