UK’s PM David Cameron Announces New Tax Evasion Law

Cameron released his personal tax records to calm the storm over the Panama Papers leak.

3 min read
UK Prime Minister David Cameron. (Photo: Reuters)

British Prime Minister David Cameron will say on Monday that new legislation making companies criminally liable if employees aid tax evasion will be introduced this year, as he seeks to repair the damage from a week of questions about his personal finances.

Cameron published tax records on Sunday to try and defuse criticism over his handling of the fallout from the Panama Papers, in which his late father was mentioned for setting up an offshore fund.

Cameron is one of dozens of politicians around the world who have been hit by the leak of 11.5 million documents from the Panamanian law firm Mossack Fonseca that detail the creation of more than 200,000 companies in offshore tax havens.

Cameron Releases Tax Records

After four carefully-worded statements in four days, Cameron bowed to pressure and admitted that he had benefitted from selling his share in his father’s fund in 2010. He recognised on Saturday that he had mishandled the disclosure.

Cameron is leading efforts to persuade British voters to stay in the European Union in a June 23 referendum that the polls suggest will be tight, and the tax row has raised concerns among the “in” camp that their cause may have been damaged.

The Prime Minister will attempt to regain the upper hand when he appears in the House of Commons later on Monday.

Companies who fail to stop their employees from tax evasion will be held liable. (Photo: iStockphoto)
Companies who fail to stop their employees from tax evasion will be held liable. (Photo: iStockphoto)

The plan had already been announced by UK Finance Minister George Osborne in March 2015, but previously the commitment was to introduce the legislation by 2020, Downing Street said.

The decision to speed up that particular measure is unlikely to satisfy Cameron’s many critics in opposition parties and in some campaign groups that say Britain already has the tools it needs to crack down on tax evasion but lacks the will.

More than $2.8 billion from offshore tax evaders since 2010 has been brought in by the government.

The government rejects that, saying it has brought in more than 2 billion pounds ($2.8 billion) from offshore tax evaders since 2010 and has established a registry of company beneficial ownership information due to become public in June this year.

The furore over his own finances has come at a particularly bad time for Cameron, who is due to host a global anti-corruption summit in London on 12 May.

He has also been struggling with deep divisions in his Conservative Party over EU membership, and the government has been embarrassed by a senior minister’s resignation, a u-turn on welfare cuts and a crisis in the British steel industry it has failed to resolve.

Cameron said on Thursday his father’s investment trust was not set up to avoid tax but to invest in dollar-denominated shares. He said he had paid all taxes due on his own investment, which was worth about 30,000 pounds when he sold it in 2010.

The documents disclosed by Downing Street on Sunday, from RNS Chartered Accountants, show Cameron paid tax of 75,898 pounds on income of 200,307 pounds in the 2014-2015 financial year, the most recent one included. ($1 = 0.7080 pounds)

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