Learn About Illicit Financial Flows
Key Terms

UK-Swiss Tax Deal ‘A Disgrace’ Warns Christian Aid

August 25, 2011

Christian Aid

Christian Aid

LONDON – The new tax deal between the UK and Switzerland amounts to collusion with criminality and will seriously damage poor countries’ attempts to collect the billions they lose to tax dodgers, Christian Aid is warning.

‘This deal makes it much less likely that developing countries will ever be able to get the taxes owed to them from those hiding money in tax havens like Switzerland. It is a disgrace,’ said Christian Aid Director Loretta Minghella.

The UK-Swiss agreement will lead to Britons with secret Swiss bank accounts starting to pay tax on them, which the Swiss will pass on to the UK – but crucially, without revealing account holders’ identities.

Tax evaders will have the option of owning up to the UK authorities about their accounts, as an alternative to paying a one-off back tax of between 19 and 34 per cent on their hidden money.

However, Ms Minghella argued that by allowing people to keep their identities hidden, the UK Government is, in effect, colluding with criminality.

‘Why would anyone rather pay a back tax of 19 to 34 per cent on the money they have hidden in Switzerland than reveal their identity, unless they have done something seriously wrong? And why is the Government letting them get away so lightly?’ she asked.

‘The most likely reason is that they have evaded a whole lot more tax than that or been involved in other serious criminal behaviour.

‘This is a bad deal for honest British tax payers and for scores of poor countries around the world.’

Christian Aid believes the deal will seriously damage global efforts to curb tax dodging – a menace which it estimates costs poor countries $160 billion a year, far more than they receive in aid.

Germany is also reported to have initialled a similar deal with Switzerland.

Poor countries lack the political and economic clout to do such deals with Switzerland – but they too lose billions as a result of money being illegally hidden in tax havens.

And just like the UK, they need that money to fund vital public services such as schools, hospitals and care for the elderly.

Christian Aid is calling on the UK and other G20 Governments to use their November summit meeting in Cannes to bring about an end to the tax haven secrecy exemplified by Switzerland.

Specifically, the G20 should broker a new system of automatic information exchange between Governments – including those of poor countries – to help them to detect when citizens hide wealth offshore.

###

Contact:

Rachel Baird
+44 0207 523 2446
+44 07545 501 749
rbaird@christian-aid.org

Notes to Editors:

1. Christian Aid works in some of the world’s poorest communities in nearly 50 countries. We act where the need is greatest, regardless of religion, helping people build the lives they deserve.

2. Christian Aid has a vision, an end to global poverty, and we believe that vision can become a reality. Our report, Poverty Over, explains what we believe needs to be done – and can be done – to end poverty.  Details athttp://www.christianaid.org.uk/Images/poverty-over-report.pdf

3.  Christian Aid is a member of the ACT Alliance, a global coalition of 100 churches and church-related organisations that work together inhumanitarian assistance and development.  Further details at http://www.actalliance.org

4. Follow Christian Aid’s newswire on Twitter: http://twitter.com/caid_newswire

5. For more information about the work of Christian Aid visit www.christianaid.org.uk

Share
Latest Press Releases

G20 Communiqué Acknowledges Broken Financial System, But Leaves Clear Solutions on the Table

Financial Transparency Coalition · November 16, 2014

BRISBANE—With the release of the Brisbane communiqué, G20 leaders have acknowledged the cracks in our financial system, yet they haven’t acted ...

This weekend, G20 leaders should roll up their sleeves and work on common sense measures to curb illicit cash

Financial Transparency Coalition · November 14, 2014

BRISBANE—While G20 leaders are poised to address many of the vehicles that are integral to allowing almost one trillion dollars to flow ...

Luxembourg Leaks Show that Corporate Secrecy is Alive and Well

Financial Transparency Coalition · November 6, 2014

WASHINGTON D.C. — Newly leaked documents detailed by the International ...