§ 3. Mr. Colin Challen (Morley and Rothwell)
What steps are being taken to prevent the loss of tax revenues through the use of offshore tax havens. 
§ The Chancellor of the Exchequer (Mr. Gordon Brown)
We are determined to tackle tax evasion and tax avoidance, including the use of tax havens, on as wide an international basis as possible. As we made clear at the European Council in June 2000, we believe that greater international co-operation—in particular, the exchange of tax information—is the key to tackling cross-border tax evasion and avoidance.
§ Mr. Challen
I thank my right hon. Friend for that reply. I also applaud the Government for the measures they are proposing in the Finance Bill to deal with tax evaders abroad. There are principally two kinds of people who use offshore tax havens: terrorists, such as al-Qaeda, who seek to destroy government by violent means; and multinational corporations, such as News Corporation, which seek to undermine government by not paying for it. Is my right hon. Friend satisfied with the international co-operation that he has received on this matter? We need to do a lot more about both those groups.
§ Mr. Brown
My hon. Friend is right. Progress is being made in international co-operation against tax evasion. The OECD issued its conclusions in June 2000 and asked all countries to agree to produce information where tax evasion was an issue. Since then, most countries, including all our dependent territories and our overseas territories, have agreed to produce that information. Seven countries remain unco-operative, and they were named in April this year. In addition, we want to ensure not just information on request, but the exchange of information as the basis of future tax policy. That is why we are making progress with the savings directive, among other things, in the European Union. We will continue, as we did in the Budget, to take further measures as necessary to tackle tax evasion.
§ Mr.John Wilkinson (Ruislip-Northwood)
Will the Chancellor give an assurance that Her Majesty's 262 Government will maintain the fiscal autonomy of the Isle of Man and the Channel Islands—if need be, against the European Union? May I remind him that the Isle of Man balances its budget by law and has a rate of unemployment of less than 1 per cent.? Were it not to have fiscal autonomy, it would be a drain on the British taxpayer, rather than the contrary.
§ Mr. Brown
I am surprised that the hon. Gentleman refers to the Isle of Man and the Channel Islands under a question that is about offshore tax havens, because the Isle of Man and the Channel Islands have brought themselves into line with the OECD recommendations. As for the savings directive. however, which requests the automatic exchange of information, I hope that all the dependent territories and all the overseas territories that are affected will agree to play their part in exchanging information on an automatic basis so that we can make progress on the directive. In case they do not, I have taken measures in the Budget announcements last month whereby we will take action if they remain unable to help us.
§ Mr. Harry Barnes (North-East Derbyshire)
How far has international co-operation extended since 11 September on offshore tax havens? Does that co-operation bring nearer the date when it will be possible to operate an international tax on currency speculation?
§ Mr. Brown
Those are two separate issues. On tax havens, because of the events of 11 September, many countries are very keen to move forward with the exchange of information as the basis on which we can reach agreements about how we deal with tax evasion, as well as money laundering and tracking terrorists' finances. The United Kingdom has agreed that it would be the first country to be subject to international surveillance of the measures that we have taken in that area. I hope that other countries will agree that international surveillance of what they do is very much part of an international system of co-operation to deal with tax evasion. We are taking action on those matters.
On the issue of tax on speculation, my hon. Friend knows well that the proposals put forward by Professor Tobin were in an era when there was not the liberalisation of currency markets that exists now. Most people would find that while it is worth looking again at whether Professor Tobin's proposals could have a beneficial effect, it is very difficult to implement them. The key question on international aid is whether we can raise the money that is necessary with or without a Tobin tax, so that we can deal with the problems of the third world, particularly education and health. The Government's proposals for a new deal in this matter, involving £50 billion extra in overseas aid, are the best way forward. At the end of the day, national Governments must make the decisions about what they are going to do.