As an attempt to put an end to the investigation about his personal wealth and to restore trust in his leadership, British Prime Minister David Cameron announced his intention to harden laws against tax evasion.
Yesterday, 11th April, during a session in the parliament, British Prime Minister, David Cameron announced his intention to harden laws to end tax evasion.
This move sought to put an end to the investigation about his personal wealth and to restore trust in his leadership.
The British Prime Minister must defend his position against Labour allegations of dodging inheritance duties when he accepted a £200,000 cash gift from his elderly mother.
The New UK Legislation on Tax Evasion
In the Parliament, Cameron highlighted the difference between illegal tax evasion and legal tax avoidance and defended whoever wants to use money to support their families, as his late father had done. He also announced the introduction of a new legislation on tax evasion this year.
Under the new legislation, companies failing to stop employees from instructing clients on ways of evading tax will be charged with criminal offence.
According to the Prime Minister, this would be just a part of what he called some of the most robust action ever taken by a British government to close tax loopholes.
Nevertheless the measures announced by Cameron did little to ease the criticism of the Labour Leader, Jeremy Corbin, who defined the Prime Minister as hypocrite for going after tax evaders in view of his father’s fund.
Cameron’s Offshore Investment Fund.
On Thursday 7th April, Cameron bowed to pressure unleashed by the Panama Papers scandal, an unprecedented leak of information from the world’s fourth-largest offshore firm, and admitted he had profited from selling his shares of an offshore investment fund in 2010, created by his late father.
The fund is not liable to taxation on both its income and capital gains and it is exempted from United Kingdom corporation tax or income tax on its profits.
Later on, on Sunday 10th April, he published a summary of his tax records for the past six years.
Read “David Cameron Hit by Panama Papers Storm” for more information on David Cameron’s offshore activities.
What the European Union is Doing about Tax Avoidance?
The EU commissioner in charge of Taxation matters, Pierre Moscovici proposes to require Europe’s international partners, like Panama, to respect international tax standards or being rather blacklisted.
The Netherlands, which holds the EU’s rotating presidency, has added a discussion on the Panama Papers to the agenda of a meeting of EU finance ministers later this month in order to pave the way and support Moscovici’s proposal while the issue is still hot.
For more information on Pierre Moscovici’s proposal read “Panama Papers: Commissioner Pierre Moscovici outraged and furious.”
Meanwhile, on his own initiative, Jonathan Hill, the European commissioner for financial services, will on Tuesday propose long-awaited rules requiring companies to report detailed financial results on a country-by-country basis.
Even if both sets of proposals were already in the pipeline long before the Panama Papers were issued, now officials and some governments hope that these revelations will lead to the approval of one of those proposals.