Tax avoidance and Syria dominate G8

Tax avoidance was nearly knocked off the G8 agenda when Barack Obama announced that the US would provide military support to the Syrian opposition forces.

While divisions over Syria are now dominating the summit, with Obama wanting to arm rebels fighting the Assad regime, tax will also feature behind the ring of steel at Fermanagh's Lough Erne resort.

For his part, European Commission president José Manuel Barroso yesterday supported Britain's agenda of trade, transparency and tax, saying: "In Europe we are leaving no stone unturned in finding out how taxes are paid. I hope that bank secrecy and tax havens will soon belong to the past."

On the issue of aggressive tax avoidance, European Council president Herman van Rompuy said such actions "undermine the social contract in our democratic societies", which "in times of financial consolidation become more unacceptable than ever".

Meanwhile, the Archbishop of York, the Most Rev John Sentamu, called on the G8 to close tax loopholes because "too many unscrupulous businesses" are robbing people in developing countries of education, health, food and employment.

Even Google got in on the act, with executive chairman Eric Schmidt appealing to the G8 to simplify the international tax system.

He said leaders must find a way of streamlining international tax without increasing corporation tax, as that would lead to less innovation, less growth and less job creation.