In the wake of the Panama Papers scandal, do you think the UK should crack down on its dependencies being used as tax havens?

I know this is the internet and there's no reason for anyone to believe me or pay any attention, but I am a relatively accomplished financial services professional with expertise in financial regulatory compliance, jurisdictional, financial vehicle, and (less so) tax matters. I also have (some, but less) political experience.

As an abstract exercise, where I try to set my own opinions aside and look at this in an abstract puzzle-solving way, I cannot see any quick or easy solution for those who want to "combat this" (as OP puts it), or as others might put it "make the rich pay their fair share".

Where do I even start with how monumental a task this would be?

I guess first, there are a lot of jurisdictions that, using the broadest sense of the term, you could consider tax havens, or dependent territories, states, or autonomous regions, which are either part of bigger countries or under their protection e.g. Nevada or Delaware in the USA, Cayman, etc. for the UK, Hong Kong for China, the various Dutch territories, etc. etc.

A lot of these territories have some degree of autonomy. Many of the British ones are basically independent countries, politically and economically.

So one of the first questions is how do you make all of these various territories, or more to the point their notional protectors (e.g. UK, USA, China, etc.), change their laws?

Say, for example, you want to stop low taxes and secrecy in the Cayman Islands - if the Cayman Islanders, who have their own government, own system etc., are happy with the way things are run, then what do you do? Abolish their parliament? If they declare independence (which they functionally are), do you invade?

Besides, if Britain does this on it's own regarding the example of the Cayman Islands, then all the business flocks elsewhere, which means a diminished UK world influence, because the money goes through one of your territories, which is a blow to the national interest.

Which sort of brings me onto another point - how the flip do you propose to change the flow of that much money without causing some major turmoil in the world economy?

Money doesn't just sit in bank accounts, and even when it does, banks lend it out, etc.

I mean...just every time I see someone calling for this kind of change, as if it's that simple...you're massively underestimating the scale and complexity of the flow of money in the world economy and the kinds of long term decisions that governments try to make.

/r/ukpolitics Thread