Cayman Islands tax agreement announced

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Chancellor George Osborne has told MPs the government will sign an agreement with the Cayman Islands to share information on British taxpayers as part of efforts to tackle tax evasion.

Speaking during Treasury questions on 5 November 2013 Mr Osborne announced that the deal would be signed with the overseas territory later that day.

Under the agreement, information held by the Cayman Islands will automatically be passed to officials at HM Revenue and Customs (HMRC), he explained.

"Today, I can [...] announce another step in the fight against tax evasion. We will be signing this afternoon a tax information sharing agreement with the Cayman Islands - the first ever with an overseas territory.

"And as a result, information of UK taxpayers held in the Cayman Islands will be automatically provided to HMRC, who will use it to collect the tax that is due," Mr Osborne said.

The UK government has said the British overseas territories, including the Cayman Islands, need to play more of a part in trying to put a stop to tax evasion.

Low taxes and light-touch regulation have seen some of them become major centres for international business.

But the lack of transparency in their banking systems has left them open to accusations that they are being used to avoid paying taxes.

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