Cameron’s initiative to open up tax havens is a good start – despite the fact that the recent agreement is only one for the UK dependencies to develop an action plan to look at transparency, rather than actually to take any action. But there will still be a long way to go after the UK dependencies have opened their doors to scrutiny.
Firstly, there are all the other tax havens in the world that are not under British control. These need to take similar action.
Secondly, transparency is needed not only for the many trusts that are held in tax havens, but also for those held everywhere else. These legal structures are just as important as companies in channeling funds away from tax authorities.
Thirdly, companies should report on the revenues of their various subsidiaries throughout the world. This would show up exactly how Starbucks, Amazon and other multinationals are dealing with their taxes.
And then, if all these things were done, there would still be the network of international treaties that permits tax dodging in the first place. We need to remember that however much we may dislike how companies operate in order to lose tax liabilities, the great majority of it is entirely legal and the structures were put there largely by democratic governments – such as Cameron’s.