Tax evasion battle is stepped up

Offshore accounts have come under greater focus

An agreement to share information between the UK and Jersey has signalled a fresh assault on tax evasion.

Jersey has agreed to sign up to a Tax Information Exchange Agreement with the UK so governments can ensure people are paying the correct amount of tax.

It allows the exchange of financial information on UK residents who have investments or companies in Jersey.

But relevant laws will first have to be brought in by both sides before the agreement becomes effective.

Extended crackdown

The UK government has already announced a review of offshore financial centres.

It has a similar agreement in operation with Bermuda already, and has signed up for deals with the Isle of Man, the British Virgin Islands and Guernsey.

"Exchange of information and transparency between countries and territories is vital in combating tax avoidance and evasion," said Stephen Timms, financial secretary to the Treasury.

"Jersey's decision to embrace this principle is very welcome and a crucial step in the right direction. More countries and territories must now follow Jersey's example.

"In coming weeks we will be working with G20 partners to boost global co-operation to address tax evasion. I urge those who have not yet met international standards to think again and start work on the necessary reforms immediately."

HM Revenue and Customs (HMRC) has been stepping up its efforts to tackle tax evasion.

In the three years to April 2007, the amount of tax recovered from network offices in so-called "non-compliance" work rose from �1.44bn to �3.1bn.