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Use of offshore tax havens by British taxpayers is 'drawing to a close', the Government has claimed after agreeing a data exchange with its counterpart in Switzerland.
A protocol delivering comprehensive exchange of information up to Organisation for Economic Co-operation and Development (OECD) and international tax standards was signed in London today by the financial secretary to the Treasury, Stephen Timms, and the Swiss ambassador to the UK, Alexis P Lautenberg.
Mr Timms said: 'I very much welcome the Swiss Federal Council’s agreement on international co-operation in tax matters and their adoption of the OECD standard on administrative assistance.
'The days when hiding money offshore represented a viable means of evading UK tax are rapidly drawing to a close.'
HMRC’s permanent secretary for tax, Dave Hartnett, added: 'Transparency and information exchange are the foundation on which fair and effective tax systems are built.
'I am delighted that there is growing global recognition of the inevitability of properly regulated information exchange as the key to proper tax visibility.'
The new protocol provides for comprehensive exchange of information to the OECD and international tax standard in respect of UK taxes of all kinds. It will also insert an arbitration provision into the mutual agreement procedure article, which will ensure the elimination of double taxation in the rare cases in which two tax authorities cannot agree on the allocation of taxing rights, such as in a transfer pricing case.
The text of the agreement can be found on the HMRC website and will in due course be laid as schedules to a draft Order in Council for consideration by the House of Commons.
It will then also be available from the Stationery Office. The protocol will come into force as soon as each government has completed the necessary procedures to give effect to it under its domestic laws.
