johnathan in the wake of the Panama
papers we've had a lot of revelations
about well-to-do people sending their
money off to faraway places in order to
avoid tax liabilities is this kind of
behavior ever acceptable well I think
it's we should start by making a
distinction between various different
sorts of activities clearly running off
with assets from a country looting it as
a political leader and salting them away
in some foreign place straightforwardly
illegal and it is totally indefensible
and I would put into the same category
tax evasion where you take your money
put it into a foreign place and hope
that the taxman never finds out that
you've done in your country of origin
but I think that there is a third sort
of activity which involves rooting
financed through jurisdictions such as
the Virgin Islands or Panama which is
not necessarily in any way illegitimate
so give me an example
a classic example would be an investment
fund an investment fund containing
investors from various different
countries which who gather together to
put their money into a third country
let's say it's an emerging market with a
somewhat shaky legal system so therefore
they want to find a place where they can
gather together with their cash where
they enjoy certain protections between
each other and with the end investor
right or the investi so and at the same
time the profits that come back and not
then taxed heavily in in the point at
which they've gathered right are lightly
taxed and then that the profits return
to those investors in their countries of
origin and they then declare their tax
to their own local authorities III
particularly made my money in London or
in Birmingham or in Edinburgh and I want
to leave it to my children say or and I
develop a trust if if I am putting that
trust abroad let's say it seems like I'm
making an effort to do a kind of
arbitrage I like living here
I like the tax system over there even if
I don't
want to live there and I'm trying to
have both look trusts have very clear
rules each jurisdiction Britain America
draw very tight rules about how trusts
can be set up on the question of on the
question of where the money is located
and the use of foreign jurisdictions
like the Virgin Islands the point I
would make is this which is we do live
in a world where essentially citizens
are free to move their capital around
the place I can I can invest in China if
I choose I think you can get it past a
central bank or I can invest in America
yeah it seems to me rather odd to draw a
distinction than to say that the British
Virgin Islands is somehow off limits let
me put this question to you are people
and companies different in this respect
are the responsibilities of the two
different I personally very sympathetic
to the idea that companies should be
obliged to be very open about what they
do anything which enjoys limited
liability should do so in plain sight in
my view and I guess shell companies
should not be allowed to exist in in
offshore jurisdictions in the way they
do if somebody is doing a legitimate
business the company is doing it making
a legitimate investment through the
British Virgin Islands it should do so
publicly and it should be possible to
you and me to see what's going on but
people who think should get a bit more
privacy I think individuals well I think
this I actually think this in a more
broadly I think it should be the case
onshore as well as offshore I think we
should be I think I think accompanies
tax affairs should be much more public
than they are in the UK but I think in
the case of individuals I think it is
reasonable with natural persons to allow
them a degree of confidentiality in
their tax affairs so if you and I are
put in charge of the UK or indeed the
world's tech tax regime where do the
reforms need to happen very simple lift
secrecy on corporate transactions shell
companies undisclosed shell companies
should be a thing of the past thanks
Jonathan