Denmark and Poland have been praised for refusing to let companies registered in offshore tax havens access economic support during the coronavirus.
Polish prime minister Mateusz Morawiecki has previously said that companies wishing to receive financial support from the government must pay domestic business taxes.
‘Let’s end tax havens, which are the bane of modern economies,’ he said.
The Danish finance ministry has also extended its bailout program into July – but would no longer cover firms based in tax havens.
It said: ‘Companies seeking compensation after the extension of the schemes must pay the tax to which they are liable under international agreements and national rules.
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‘Companies based on tax havens in accordance with EU guidelines cannot receive compensation, insofar as it is possible to cut them off under EU law and any other international obligations.’
A spokesperson for the Treasury admitted its bailout scheme will involve foreign companies, but said it is designed to support British jobs.
They told Business Insider: ‘Obviously we’ve set up schemes at pace, and they are designed to support jobs in Britain.’
‘Sometimes that will involve foreign companies who employ people in the UK for example. But we are looking into the specific point on tax havens where as you know we have already taken considerable action.’
Robert Palmer, an executive director at Tax Justice UK, said that businesses using offshore tax havens should not expect support from government.
He said: ‘Companies that seek to dodge their obligations to broader society by cutting their tax bills shouldn’t expect to get bailed out when things go wrong.
‘The UK government should seriously look at copying Denmark’s approach. Any bailout needs to come with conditions to ensure good business behaviour.’
‘All credit to Denmark and Poland who are refusing to let companies registered in offshore tax havens access financial aid from their #coronavirus bailout packages,’ tweeted James Melville.
‘Time for all the big boys to do the same,’ said another.
‘This should be standard practice. Why bail out offshored business that have evaded taxes for years?’ asked Alexandra Kleeman.