The British government is attempting to torpedo a section of an international plan to eradicate tax evasion in a move that has sparked widespread condemnation.
The Observer has established that the UK is lobbying to remove paragraph 10 from the draft Doha Outcome Document. The document, which is scheduled to be ratified in November, is the most important element in the international process intended to help developing countries wean themselves off aid and establish sustainable economies.
Paragraph 10 focuses on fighting tax evasion. It aims to encourage global tax information-sharing and simplified tax laws. Most crucially, it wants to upgrade the UN's tax-expert panel to intergovernmental status, elevating the importance of the issue of individual and corporate tax avoidance and evasion.
The UK, together with the US, Canada and Australia, are opposed to the measure, according to sources in the UN.
John Christensen, director of Tax Justice Network, said: 'The European Parliament last week made a strong statement demanding the commission support this document. Britain is out on a limb within Europe. It's the usual suspects of the US, UK, Australia and Canada. These are the countries that created the toxic financial crisis undermining the global economy. Seemingly lessons have not been learnt.'
A Treasury spokesman said: 'The UK makes an active contribution to the existing UN tax committee. It is not clear that an upgrade to the existing committee ... would deliver any additional benefit.'
Critics have suggested the UK is blocking paragraph 10 to protect the interests of City law and accountancy firms.