It is in the UK's power to end tax havens

Cameron needs to lead on tax dodging, because he has the power to stop it.

Tomorrow, David Cameron will be welcoming senior ministers from some of the UK’s tropical isles to London for a high level summit. Despite these jurisdictions’ sandy beaches and sunny weather the talk will be of tax, not tourism, as the likes of Bermuda, the Cayman Islands and the British Virgin Islands rank as some of the most significant tax havens in the world.

Cameron’s grand plan is to invite these jurisdictions to sign up to an international treaty on cooperation and information sharing with other countries tax authorities. Cameron is keen to show that the UK is committed to getting its house in order ahead of the G8 summit in Northern Ireland next week. With a huge domestic backlash at home over tax dodging by companies like Google, Amazon and Starbucks, Cameron is hoping the appearance of leadership on the global stage can win some positive headlines at home.

But show and appearance is all we will see over the next few days. The treaty Cameron is asking British tax havens to sign only tinkers around the edges of their secrecy. It will still leave the UK running many of the world’s most significant tax havens. That the government continues to allow multinational companies and rich individuals to use the UK’s tax havens to dodge taxes around the world, robbing the world’s poorest countries of vital revenue, is a scandal of truly epic proportions.

Experts from the Tax Justice Network have criticised this treaty for falling short of what would be needed to break open their secrecy. For a start it only requires jurisdictions to share information when they receive requests from other countries’ tax authorities, rather than automatically and routinely sharing information. Neither does it require tax havens to actually collect information on rich individuals and companies that shelter their money offshore. 

It is not entirely surprising the treaty is not exactly watertight. It is drafted by the OECD, a Paris-based think tank, comprising 34 of the world’s richest countries, tasked with setting the standards for international tax rules: a body that has steadfastly resisted any major change to those rules for over a decade.

At the 2009 G20 summit, when Gordon Brown famously hailed the “beginning of the end for tax havens”, the OECD was tasked with producing a ‘blacklist’ of uncooperative tax havens. So rigorous were the rules for this list that within one week there was not one country on the list.

However, the failure to reign in Britain’s tax havens is not one of diplomacy. It reflects a total lack of political ambition. The simple fact is that these islands are not separate sovereign countries and Cameron does not need to negotiate with them. They are in fact British territories, and the UK government has the power to legislate for them.

Cameron could simply abolish the UK’s tax havens by passing a law requiring them to end their secrecy, establish rigorous financial regulation and making profits and wealth their subject to effective taxes. 

The government has acted in the past to enforce laws on these island jurisdictions before, abolishing the death penalty for Britain’s Caribbean Islands in 1991 and as recently as the year 2000, acting to decriminalise homosexual acts in the Cayman Islands. 

The British government has even acknowledged its full ability to enforce financial regulation on the UK’s tax havens. The OECD noted in a 2012 report (pdf) “the UK acknowledged that – from a constitutional perspective the UK has unlimited power to legislate for the OTs [Overseas Territories]”. 

Cameron has tried to make huge political capital of talking tough on tax. Last year Cameron announced his intention to tackle tax havens during his G8 presidency with huge fanfare, saying: “There are too many tax havens, too many places where people and businesses manage to avoid paying taxes.” Again in Davos at the World Economic Forum the bold rhetoric was out in force, stealing lines from UK Uncut, when he told businesses that “carry on dodging their fair share” to “wake up and smell the coffee”.

To have any hope of living up to his tough tax talk, Cameron must legislate to abolish Britain’s tax havens. He is fully capable of closing down these tax havens, but is just choosing not to.

Grand Cayman. Photograph: Getty Images

Murray Worthy is an economic justice campaigner for War on Want.

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How Donald Trump is slouching towards the Republican nomination

There was supposed to be a ceiling above which Trump’s popular support could not climb.

In America, you can judge a crowd by its merchandise. Outside the Connecticut Convention Centre in Hartford, frail old men and brawny moms are selling “your Trump 45 football jerseys”, “your hats”, “your campaign buttons”. But the hottest item is a T-shirt bearing the slogan “Hillary sucks . . . but not like Monica!” and, on the back: “Trump that bitch!” Inside, beyond the checkpoint manned by the Transportation Security Administration and the secret service (“Good!” the man next to me says, when he sees the agents), is a family whose three kids, two of them girls, are wearing the Monica shirt.

Other people are content with the shirts they arrived in (“Waterboarding – baptising terrorists with freedom” and “If you don’t BLEED red, white and blue, take your bitch ass home!”). There are 80 chairs penned off for the elderly but everyone else is standing: guys in motorcycle and military gear, their arms folded; aspiring deal-makers, suited, on cellphones; giggling high-school fatsos, dressed fresh from the couch, grabbing M&M’s and Doritos from the movie-theatre-style concession stands. So many baseball hats; deep, bellicose chants of “Build the wall!” and “USA!”. (And, to the same rhythm, “Don-ald J!”)

A grizzled man in camouflage pants and combat boots, whose T-shirt – “Connecticut Militia III%” – confirms him as a member of the “patriot” movement, is talking to a zealous young girl in a short skirt, who came in dancing to “Uptown Girl”.

“Yeah, we were there for Operation American Spring,” he says. “Louis Farrakhan’s rally of hate . . .”

“And you’re a veteran?” she asks. “Thank you so much!”

Three hours will pass. A retired US marine will take the rostrum to growl, “God bless America – hoo-rah!”; “Uptown Girl” will play many more times (much like his speeches, Donald J’s playlist consists of a few items, repeated endlessly), before Trump finally looms in and asks the crowd: “Is this the greatest place on Earth?”

There was supposed to be a ceiling above which Trump’s popular support could not climb. Only a minority within a minority of Americans, it was assumed, could possibly be stupid enough to think a Trump presidency was a good idea. He won New Hampshire and South Carolina with over 30 per cent of the Republican vote, then took almost 46 per cent in Nevada. When he cleaned up on Super Tuesday in March, he was just shy of 50 per cent in Massachusetts; a week later, he took 47 per cent of the votes in Mississippi.

His rivals, who are useless individually, were meant to co-operate with each other and the national party to deny him the nomination. But Trump won four out of the five key states being contested on “Super-Duper Tuesday” on 15 March. Then, as talk turned to persuading and co-opting his delegates behind the scenes, Trump won New York with 60 per cent.

Now, the campaign is trying to present Trump as more “presidential”. According to his new manager, Paul Manafort, this requires him to appear in “more formal settings” – without, of course, diluting “the unique magic of Trump”. But whether or not he can resist denouncing the GOP and the “corrupt” primary system, and alluding to violence if he is baulked at at the convention, the new Trump will be much the same as the old.

Back in Hartford: “The Republicans wanna play cute with us, right? If I don’t make it, you’re gonna have millions of people that don’t vote for a Republican. They’re not gonna vote at all,” says Trump. “Hopefully that’s all, OK? Hopefully that’s all, but they’re very, very angry.”

This anger, which can supposedly be turned on anyone who gets in the way, has mainly been vented, so far, on the protesters who disrupt Trump’s rallies. “We’re not gonna be the dummies that lose all of our jobs now. We’re gonna be the smart ones. Oh, do you have one over there? There’s one of the dummies . . .”

There is a frenzied fluttering of Trump placards, off to his right. “Get ’em out! . . . Don’t hurt ’em – see how nice I am? . . . They really impede freedom of speech and it’s a disgrace. But the good news is, folks, it won’t be long. We’re just not taking it and it won’t be long.”

It is their removal by police, at Trump’s ostentatious behest, that causes the disruption, rather than the scarcely audible protesters. He seems to realise this, suddenly: “We should just let ’em . . . I’ll talk right over them, there’s no problem!” But it’s impossible to leave the protesters where they are, because it would not be safe. His crowd is too vicious.

Exit Trump, after exactly half an hour, inclusive of the many interruptions. His people seem uplifted but, out on the street, they are ambushed by a large counter-demonstration, with a booming drum and warlike banners and standards (“Black Lives Matter”; an image of the Virgin of Guadalupe, holding aloft Trump’s severed head). Here is the rest of the world, the real American world: young people, beautiful people, more female than male, every shade of skin colour. “F*** Donald Trump!” they chant.

After a horrified split-second, the Trump crowd, massively more numerous, rallies with “USA!” and – perplexingly, since one of the main themes of the speech it has just heard was the lack of jobs in Connecticut – “Get a job!” The two sides then mingle, unobstructed by police. Slanging matches break out that seem in every instance to humiliate the Trump supporter. “Go to college!” one demands. “Man, I am in college, I’m doin’ lovely!”

There is no violence, only this: some black boys are dancing, with liquid moves, to the sound of the drum. Four young Trump guys counter by stripping to their waists and jouncing around madly, their skin greenish-yellow under the street lights, screaming about the building of the wall. There was no alcohol inside; they’re drunk on whatever it is – the elixir of fascism, the unique magic of Trump. It’s a hyper but not at all happy drunk.

As with every other moment of the Trump campaign so far, it would have been merely some grade of the cringeworthy – the embarrassing, the revolting, the pitiful – were Trump not slouching closer and closer, with each of these moments, to his nomination. 

This article first appeared in the 28 April 2016 issue of the New Statesman, The new fascism