Treasury minister Stephen Timms has written to 16 countries, including South Africa, Vietnam and Cameroon, to ask them to join a tax exchange involving Britain by the end of the year.

It is believed that Timms has asked for a response by the end of March.

The G20 group of major developed and emerging economics has worked hard in order to eradicate tax evasion, tax avoidance and money laundering in the past couple of years in a bid to help to reinforce the financial system in the wake of the ‘credit crunch’.

However, Timms is concerned that the risk of tax avoidance stretches beyond G20 countries and is hoping to wipe out tax avoidance across the globe.

There are also concerns that tax evasion is leading to poorer countries struggling to develop and it has been suggested that developing countries miss out on up to $50 billion in lost revenue due to tax evasion.

Timms stated:-

“The discussions will be an important further step to ensuring developing countries have the ability to collect the tax they are owed.

For too long developing countries have been cheated out of tax revenues by individuals and some companies – we will not allow this to continue.”

More Economically Developed Countries (MEDC’s) are worried they may be missing out on tax due to companies juggling their accounts between countries with more flexible tax systems, such as those in Less Economically Developed Countries (LEDC’s).

Timms attended a conference on Wednesday 10th February 2010 in Jersey to discuss how LEDC’s can improve the amount of revenue they earn, lessen money laundering and improve their financial regulations.

Timms praised Jersey for their ‘excellent’ progress in combating tax evasion and money laundering and said that the times of taxpayers to play countries off against each other is over.

Timms said:-

“Jersey is making a very important contribution and it has become much tougher for those who want to bend the rules on tax”.

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