UKRAINE is set to launch a crackdown against Scottish tax-haven firms after a series of high-profile money-laundering scandals.
The former Soviet Republic, which is currently carrying out a nationwide anti-corruption clean-out, is mulling tougher new rules for businesses and individuals who use offshore jurisdictions.
Senior officials have signalled controversial Scottish limited partnerships, or SLPs – a type of business routinely advertised globally as off-the-peg “zero-tax companies” – will fall under the same enforcement regime as traditional tax havens in the Caribbean.
The move marks a dramatic change in public perceptions of the UK and Scotland as tax havens in the Ukraine thanks to a boom in SLPs.
The ruling is expected to affect forms of partnerships from the English-speaking world, including English limited liability partnerships and similar entities from Delaware, Arkansas, Canada and New Zealand.
Crucially, SLPs will be added to a list of low-tax regimes which no longer includes Switzerland.
A spokesman for the Ukraine’s State Fiscal Service said: “For many, this will mean stress because, Switzerland, for example, fought for many years to be removed from the list of low-tax jurisdictions. But [the move] is justified legally, statistically, and economically. And we hope that this list will close yet another crack in our tax system.”
SLPs are currently under review by the UK Government, mostly because of reports of their use by international money-launderers and tax evaders and the dangers this poses to Britain’s global reputation for upholding the rule of law.
Several SLPs have been named in Ukrainian criminal cases, including at least two allegedly used by corrupt officials to take multi-million-pound slices of arms export contracts. SLPs allow owners’ identity to remain
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