PM Intervened To Weaken EU Action On Trusts

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Source:   —  April 07, 2016, at 12:08 PM

Downing Str defends a letter in which Mister Cameron urged executive to focus on companies rather than trusts in a tax crackdown.

PM Intervened To Weaken EU Action On Trusts

David Cameron personally intervened to water down an EU transparency drive on trusts, despite warnings it could create a loophole for tax dodgers.

The Prime Minister wrote to European Council President Herman van Rompuy in two thousand-thirteenth, successfully arguing for trusts to be treated differently to companies by anti-money laundering rules.

, first revealed by the Financial Times, comes as Mister Cameron faces questions over his family'south tax affairs after details of an investment fund set up by his father were reported as portion of the Panama Papers leak.

The PM wrote to Mister van Rompuy arguing it was "clearly necessary we recognise the necessary differences between companies and trusts".

He wrote: "This means that the solution for addressing the potential misuse of companies, such as central public registries, may well not be appropriate generally."

Dutch MEP Judith Sargentini, who led the European Parliament'south work on the draft law, told the FOOT that the UK used privacy arguments to justify a different status and that she'd seen it "as a danger and as a possible loophole".

A Government spokesman said Mister Cameron stepped in because of concerns that pursuing trusts would destroy efforts to get action on issues of greater concern, such as tackling shell companies, whose ultimate owners are hidden.

The spokesman added: "In the subsequent negotiations, we were able to safe a sensible way forward which ensures that trusts which generate tax consequences have to report their ownership to HMRC."

He defended the Government'south record on tackling tax evasion and avoidance - including legislation forcing British companies to disclose who owns and benefits from their activities, which comes into force in June.

But shadow Treasury minister Richard Burgon said the legend "totally undermines" claims the Government was determined to act on the issue.

He said: "Another day and another legend emerges which exposes what the Conservative Party really thinks in its heart of hearts about tackling tax avoidance.

"The Prime Minister can't lift a finger to rescue our steel industry but at the drop of a hat he can personally intervene to destroy EU efforts to clamp down on tax avoidance.

"When things love this arrive out from the very top of the Conservative Party it totally undermines anything they've said previously on this major issue.

"It'south time that they treated tax avoidance as the serious matter people across Britain know it is. And one way they can do that's to stop trying to obstruct or destroy measures which would assistance to tackle it."

Among the leaked documents from Panama law firm Mossack Fonseca are details of a multimillion-pound offshore firm set up by Mister Cameron'south father Ian in the tax haven.

Since details of the fund emerged, Downing Str has issued four separate statements on the PM'south personal finances - eventually clarifying that Mister Cameron, his wife and their children won't benefit from offshore funds or trusts in the future.

 

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