Top politician says UK government should bin offshore tax havens
Vince Cable , a Liberal Democrat MP and one of the UK's most prominent opposition politicians, said the government should close offshore financial centres in places like Monaco, Singapore and the Channel Islands, to avoid conflicts of interest now that a number of UK private banks with offshore centres are under government jurisdiction.
Cable told Wealth-Bulletin that the government, which has so far taken a passive position on tax havens, must act decisively to close loopholes that allow super-wealthy account holders to avoid paying tax, leaving the UK taxpayer to pick up the bill.
With the recent bail-outs, the government will hold as much as 60% of RBS and up to 43.5% of a combined HBOS and Lloyds TSB stake after the transaction is complete.
The British government has said protecting taxpayers is central to its bailout plan, and Cable said it may not look favourably on the wealthy, particularly while it is struggling for cash.
"The overall aim of these measures is to support stability in the financial system; to protect ordinary savers, depositors, businesses and borrowers; and to safeguard the interests of the taxpayer," the UK Treasury said in a statement yesterday.
Coutts & Co, the 300-year old UK private banking operations of Royal Bank of Scotland, has 27 offices in the UK and one in Monaco. Internationally the business operates under the brand RBS Coutts in 16 countries, including Hong Kong, Singapore, Spain, the Isle of Man, Switzerland and the Middle East. RBS Coutts has 39,000 clients and Coutts & Co has 69,000 clients.
Coutts said its owners have never had access to client accounts, and will not do so in future.
A spokeswoman for your bank said: “Shareholders are not entitled to seek access to client information. As the government becomes a shareholder in our business, we would expect no change to the rules and principals of banking and confidentiality.”
The bank also makes the point that the Swiss and other offshore centres are regulated by the jurisdiction they are in, not the UK.
“RBS Coutts is regulated in Switzerland, under Swiss law. Coutts & Co is regulated in the UK, under UK law and the exchange of client information between the two companies is not permitted, except with the expressed permission of the client,” said the spokeswoman.
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