Taxes, bank accounts and identities will be shared in a groundbreaking tax deal signed by 51 jurisdictions including the UK.
Under the agreement, signed in Berlin, unprecedented levels of information, including account balances, interest payments and beneficial ownership, will be shared with the UK from countries across the world.
Most European Union nations have signed the deal as well as traditional tax havens like and the British Virgin Islands, the Cayman Islands, and Guernsey.
Grace Perez-Navarro, of the Organisation for Economic Co-operation and Development (OECD) said that banking secrecy provided by tax havens would be wiped out because of the agreement.
“Will countries like the Cayman Islands be able to maintain an economy like they currently have? If it’s based on financial quality that’s OK, but if it’s based on secrecy, they won’t be able to continue” she said.
Speaking ahead of the event the Chancellor of the Exchequer, George Osborne, commented:
“Today we strike a blow on behalf of hardworking taxpayers who are cheated when rich people don’t pay their taxes.
“Today we send a clear message to those who still think they can escape making a fair contribution to our public services and to reducing our deficit: you can hide no more; we are coming to get you.”
However, experts have questioned whether Britain is in a position to establish the changes needed to gather and share complicated financial information about millions of companies.
Richard Murphy of the Tax Justice Network said “The UK cannot honour its commitment. We do not have a tax authrority that has enough staff…we havent got the data to send.”
But Ms Perez-Nevarro said she was confident that Britain would uphold is commitment. “It may be true that the system isnt there yet. The cost will be high but if there is political commitment at the highest levels of government. There is no turning back.”