Activists demand that UK act on tax havens

ActionAid Denmark accuses British overseas territories of facilitating tax evasion worth trillions of kroner a year; British ambassador says the problem is being addressed

Gold-clad activists from ActionAid Denmark (AAD) turned up out outside the British Embassy yesterday to demand that the UK close down its tax havens.

The group says that one in every five tax havens around the world is a British overseas territory or crown dependency – such as the Channel Islands of Jersey, Guernsey and Sark – that are used by businesses and individuals to syphon wealth out of countries without paying taxes.

“World leaders talk at length about tackling tax havens but the fact is that Denmark’s ally is playing a key role in enabling tax havens that drain billions of dollars from state coffers every year,” AAD spokesperson Nils Brøgger Jakobsen said.

READ MORE: Offshore accounts are "immoral": tax minister

Tax evasion on the agenda
Tax minister Holger K Nielsen (SF) has put tackling tax havens on the political agenda and was pleased when the G8, chaired by the UK, agreed on new rules to tackle international tax fraud this summer.

But Pamela Chisenga, director of ActionAid Zambia, says that more needs to be done to ensure that businesses pay their taxes.

“Children die of malnutrition every day in Zambia and young people are lacking an education because there is not enough public funds to pay for it,” Chisenga said. “If multinational businesses in Zambia paid the taxes in the country instead of moving their money to UK-controlled tax havens, we could make sure that all the children in Zambia receive proper food.”

Ambassador Life responds
ActionAid Denmark invited British ambassador Vivien Life to attend a screening of the documentary about UK tax havens, 'The UK Gold', and participate in a panel debate.

In a letter to ActionAid Denmark, Life declined the invitation but wrote that the UK was working to tackle tax evasion and aggressive tax avoidance.

“Tax evasion is illegal [and] should be subject to the full force of the criminal law,” Life wrote. “Tax avoidance is less black and white. There’s nothing wrong with sensible tax [but] there are some forms of avoidance that have become so aggressive that the UK believes it is time for governments to act.”

READ MORE: Bank advises customer on how to dodge taxes

UK is taking action
According to Life, the UK has made progress as G8 chair by increasing awareness of tax evasion in the developed and developing world, improving the transparency of company ownership, and ensuring that anti-money laundering and counter-terrorist financing regimes are effective.

She added that British overseas territories and crown dependencies have also agreed to join a convention on the sharing of tax information and improving the availability of information on so-called beneficial ownership – when someone puts an asset in someone else’s name but has full access to the assets.

“This is real action which will make a real difference to ordinary people," she wrote. 

According to a 2012 report from the Tax Justice Network, between 117-178 trillion kroner is sheltered from taxes in unreported tax havens worldwide.

AAD carried out a similar action last week at the Vesterbrogade branch of Jyske Bank after a DR documentary showed a bank employee giving advice on how to avoid paying Danish taxes