David Cameron's call to tackle tax avoidance

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The Prime Minister has written to leaders of Britain's offshore tax havens to push for international action to tackle tax avoidance schemes.

In the letter to the leaders of ten crown dependencies and British overseas territories David Cameron said he backed their right to low tax jurisdictions, but insisted rules needed to be set and enforced fairly.

Mr Cameron's call for the need to ''get our own houses in order'' on tax, comes as he was expected to raise the issue of corporate tax with Google boss Eric Schmidt at the Business Advisory Group meeting on Monday. Mr Schmidt is a member of the group, which is holding its quarterly meeting in Downing Street. Meetings are held behind closed doors but a source revealed tax will be discussed.

The meeting follows a recent mauling of Google (NasdaqGS: GOOG - news) by MPs on the Public Accounts Committee over its tax affairs.

The Prime Minister wrote to leaders in countries including Bermuda, the British Virgin Islands, the Cayman Islands and Gibraltar to call for more transparency over tax and the ownership of companies. He wrote: "I respect your right to be lower tax jurisdictions. I believe passionately in lower taxes as a vital driver of growth and prosperity for all.

''But lower taxes are only sustainable if what is owed is actually paid - and if the rules to achieve this are set and enforced fairly to create a level playing field right across the world. There is no point in dealing with tax evasion in one country if the problem is simply displaced to another.''

The letter comes ahead of the G8 summit next month where Mr Cameron said he had made "fighting the scourge of tax evasion and aggressive tax avoidance a priority."

Mr Cameron said he wanted the sharing of tax information to become more accurate, so it was clear who owned companies. He added: ''This goes right to the heart of the ambition of Britain's G8 to knock down the walls of company secrecy."

Mr Cameron welcomed public commitments that had already been made by some leaders to produce action plans in his letter and said plans will need to provide for centralised registries that are available to tax collectors and law enforcement agencies.

He also wrote "As you know, I have made fighting the scourge of tax evasion and aggressive tax avoidance a priority for the G8 Summit which the UK is hosting next month.

"With one month to go, this is the critical moment to get our own houses in order. I am looking to all the overseas territories and crown dependencies to continue to work in partnership with the UK in taking the lead on two critical issues: tax information exchange and beneficial ownership."

Labour leader Ed Miliband has pledged to take action to prevent firms from exploiting tax loopholes if no deal is done at the G8 summit, if he is elected.