Overview

The Tax and Financial Transparency Bill aims to increase tax transparency by requiring the UK government to secure tax information exchange agreements with British Overseas Territories and Crown Dependencies, and by mandating greater tax reporting from UK-based financial institutions, companies, and trusts.

Description

This bill introduces several key measures:

• Secretary of State's Duties: The Secretary of State must secure Tax Information Exchange Agreements (TIEAs) with all British Overseas Territories and Crown Dependencies (Jersey, Guernsey, Isle of Man). Annual reports to Parliament on progress will be required.
• Financial Institution Reporting: All UK financial institutions (as defined in the Banking Act 2009) must report any TIEA breaches to HMRC.
• Company and Trust Transparency: All companies operating in the UK (including those trading, acting charitably, or making political donations) must publicly disclose comprehensive tax payment information for all countries. Regulations will extend this requirement to other specified trusts and organizations.
• Penalties: The Secretary of State will set penalties for non-compliance with sections 2 and 3 via statutory instrument, subject to parliamentary approval.

Government Spending

The bill doesn't directly specify government spending figures. The cost will likely relate to increased HMRC oversight and enforcement, as well as the resources required by the Secretary of State to negotiate and implement TIEAs. No specific figures are provided in the bill text.

Groups Affected

• British Overseas Territories and Crown Dependencies: These jurisdictions will face pressure to cooperate in sharing tax information with the UK.
• UK Financial Institutions: Increased reporting requirements and potential penalties for non-compliance.
• UK Companies and Trusts: Increased transparency obligations regarding tax payments globally, requiring more detailed reporting.
• HMRC: Increased workload related to enforcement and oversight.
• Parliament: Will receive annual reports on progress and will have a role in approving penalties.

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