WATCH Government forced into major climbdown on tax havens to avoid Commons defeat
3 min read
Tax havens around the world will be forced to publish the names of fat-cat property owners in a major government U-turn, it emerged today.
Ministers caved in to the demand for a crackdown on secrecy in British overseas territories to avoid a humiliating defeat in the House of Commons.
Announcing the climbdown, Foreign Office minister Sir Alan Duncan said they would not block an amendment to the Sanctions and Anti-Money Laundering Bill which would force jurisdictions to publish the names of those who own UK property but are registered overseas.
But he also warned the decision could tee up a major constitutional clash between the UK and independent overseas territories.
David Cameron had promised to bring forward public ownership registers for the offshore hubs such as the British Virgin Islands and Cayman Islands in 2013 - but the plan was dropped by Theresa May.
It is thought that some £122bn of property in England and Wales is owned through offshore companies.
The Government made the concession after some 20 Conservatives rallied to support the amendment tabled by Labour MP Margaret Hodge and Tory MP Andrew Mitchell.
Ministers tried to table their own amendments to neuter the bid - but the proposals were thrown out by Speaker John Bercow as they came too late.
Sir Alan told MPs: “We have listened to the strength of feeling in his House on this issue and accept that it is without a doubt the majority view of this House that the overseas territories should have public registers ahead of it becoming the international standard as set by the financial actions task force.
“We will accordingly respect the will of the House and will not vote against new clause 6.”
But he warned: “Her Majesty’s government is acutely conscious of the sensitivities about this in the overseas territories and the response it may provoke.”
And he added: “We do not want to legislate directly for [the British overseas territories], nor do we wish to risk damaging our long-standing constitutional arrangements which respect their autonomy.”
Sir Alan said the government would offer the overseas territories “the fullest possible legal and logistical support” to help them establish public registers of beneficial ownership.
Labour MPs joined anti-tax avoidance campaigners in heralding the Government U-turn on overseas registers.
Labour welcomed the U-turn but said it was "just a first step and the Tories shouldn't be allowed to just stop there".
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