U.K. to Crack Down on Offshore Tax Havens

The U.K.’s Treasury will force crown dependencies such as Jersey and the Isle of Man to reveal the names of subjects holding secret bank accounts within their shores, the Observer reported on its website Saturday, citing a report in International Tax Review magazine, which based its reporting on a leaked internal document.

According to the Observer’s story, the U.K. will institute its own version of the U.S.’s soon-to-be-enacted Foreign Account Tax Compliance Act, which will penalize banks doing business in the U.S. that hide the data of American clients from the Internal Revenue Service. In fact, the U.K. version will piggyback the U.S. law. If a dominion territory refuses to comply with the U.K.’s demand for information, the U.K. will block that dominion’s attempts to comply with the U.S. law, putting it in violation with the I.R.S. and potentially harming its economy, according to the Observer’s report.

Critics of the plan are skeptical, according to the report, which quotes former Treasury spokesman Lord Oakeshott as saying, “Tax havens really coming clean are as likely as a snowy Christmas Day in the Cayman Islands.”

Complete report: http://www.guardian.co.uk/business/2012/nov/25/treasury-british-tax-havens-crackd wn?CMP=twt_fd

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U.K. to Crack Down on Offshore Tax Havens