Beneficial Ownership Registers: Overseas Territories and Crown Dependencies

Debate between Margaret Hodge and Angela Eagle

Thursday 7th December 2023 Commons Chamber

[Dame Margaret Hodge]

I am left wondering whether The Sunday Times would ever publish that—we shall see.

Let me address the point made by the hon. Member for Bromley and Chislehurst (Sir Robert Neill). In April 2019, the right hon. Member for Sutton Coldfield and I sought legal advice about whether it would be constitutionally lawful for the UK Parliament to legislate to compel all Crown dependencies to establish public registers of beneficial ownership. I have the advice here, which concluded:

“It is beyond doubt that the intrusion of criminal funds into the UK economy threatens the interests of the UK. It is also beyond doubt that extensive funds in this category emanate from the Crown dependencies.”

The last sentence states: “The proposed amendment”—we put an amendment to the King’s Counsel to consider whether it was lawful—

“is a constitutionally legitimate and lawful exercise of the UK’s powers to secure its domestic interests by protecting confidence in its financial institutions and the integrity of the commercial life of the nation”.

Finally—I recognise that we are running out of time— I want to touch on the compromise that I think the Minister is seeking to secure in his negotiations with our tax havens. The compromise is that in order to have access, a member of the public needs to have a legitimate interest, a term that was introduced in the European Union’s sixth anti-money laundering directive. We already have that proviso in relation to the register of overseas properties, and I draw to the Minister’s attention the fact that Transparency International has put in inquiries in six cases to get information, has waited for four to six months, and has then seen those requests for information turned down by His Majesty’s Revenue and Customs. All of those requests were in relation to trusts listed as the beneficial owners of overseas companies that hold property here in the UK, and we would have expected them to be on that register and for the information to be provided.

[Dame Angela Eagle (Wallasey) (Lab)]

Surely, every single citizen of this country has a legitimate interest in closing the kinds of loopholes that have allowed rotten, dirty money to come flooding into our jurisdiction. Does my right hon. Friend agree that it has had huge detrimental effects on ordinary people—who do not have trust funds and are unlikely to inherit anything—such as the huge increases in property prices that have forced many people out of the housing market?

[Dame Margaret Hodge]

My hon. Friend makes an important point: those who suffer the most are the poorest in our community. One must remember that no tax is levied on all this illicit finance, so it does not fund the public services that we require. I would also point out to the Minister that a legitimate interest proviso does not meet the requirements of the Sanctions and Anti-Money Laundering Act 2018: the terms of the draft Order in Council specifically said that we want

“a compliant publicly accessible register”.

I ask the Minister to think about that.

Sunlight is the best disinfectant—we all know that. If we are serious about our effects to clamp down on dirty money and eliminate it from Britain, and from our overseas territories and Crown dependencies, we must have public registers, so that we can at the very least start to follow the money.

Tax Avoidance and Evasion

Debate between Margaret Hodge and Angela Eagle

Tuesday 14th November 2017 Commons Chamber

[Dame Margaret Hodge]

I agree with the hon. Lady that resourcing HMRC is absolutely central to the fight against tax avoidance and evasion.

Tax avoidance is completely different from tax planning, whereby, for example, Parliament intended to encourage people to save for their pension by introducing ISAs with tax breaks. Tax avoiders, on the other hand, thwart the intention of Parliament. Their action means our collective will is ignored. We should not tolerate it and we must act urgently to eradicate it.

[Ms Angela Eagle (Wallasey) (Lab)]

Does my right hon. Friend agree that one of the best ways of trying to deal with this increasingly serious issue is to have openness and transparency in all funds held offshore, so that those who are doing this have to face the legitimate scrutiny of taxpayers in this country?

[Dame Margaret Hodge]

My hon. Friend makes an absolutely central point to what we will be asking for today.

Not only does the behaviour of a few damage trust in the system as a whole, but it damages the public services our taxes are used to fund. At a time when the NHS is under such pressure, when public sector workers have had their wages held down for years and our schools are struggling to deliver the best start for all our children, for the super-rich and the powerful to think that they can opt out of their duty to contribute fairly through paying taxes is completely and utterly and totally immoral and wrong, and it is our responsibility to put an end to it.