The Paradise Papers once again show that secrecy, trusts, shell companies and a thriving tax-avoidance industry are undermining much-needed tax revenues in the UK and elsewhere. The revelations provide a glimpse of the moral bankruptcy of British governments which have done little to tackle tax avoidance at home or through crown dependencies and overseas territories such as Bermuda or the Cayman Islands.

The UK is responsible for the “good governance” of Bermuda and other overseas territories and Westminster has “unlimited power to legislate for the territories”. All laws of the British overseas territories are approved by the sovereign with advice from the privy council. Its members are senior government ministers and other politicians, including Lord Ashcroft, who became a privy councillor in 2012 and whose financial affairs have been leaked by the Paradise Papers. A public inquiry is needed into why the privy council continues to approve laws that cause financial harm to the UK and other countries.

Shell companies with anonymous shareholders and directors are a key feature of the Paradise Papers and its predecessors the Panama Papers, Luxembourg Leaks and HSBC Leaks. Yet the government refuses to take effective action at home or abroad. Last month the government said it would not “prohibit nominee shareholdings”, a key mechanism for concealing the identity of the ultimate owners, controllers and beneficiaries of tax games.

The UK needs to respond strongly to the shady practices in tax havens. Either unilaterally or in collaboration with the European Union, it should impose sanctions against aggressive tax havens. All trusts, contracts and other transactions executed through the blacklisted tax havens should be considered null and void, unless full disclosure is made to the relevant UK and/or the EU authorities.

Transparency, public accountability and citizen empowerment are powerful weapons for lifting the cloak of secrecy used by elites to stash their gains and avoid taxes. Following the EU fourth anti-money laundering directive, HMRC has begun the process of creating a register of trusts. However, the government has refused to make it publicly available. It should be – as without the sight of the register, whistleblowers and concerned citizens cannot scrutinise the data or complete the gaps.

Tax returns of all wealthy individuals should be made publicly available. The tax computations of all large corporations, together with advice received from accountants and lawyers, key players in the global tax avoidance industry, should be filed at Companies House and made publicly available. The public availability of information is what will enable citizens to check the affairs of powerful elites and draw the attention of HMRC to omissions and dubious practices.

These latest disclosures will also strengthen the oversight exercised by parliamentary committees. We all remember how the public accounts committee’s inquiries into the tax affairs of large companies and sweetheart deals between HMRC and companies were thwarted with the claims that the information was “confidential”. That “confidentiality” will be eroded with public filing of tax returns, and parliamentary committees can get on with the real task of investigating legislative and regulatory failures.

Once again the Paradise Papers draw attention to the handiwork of intermediaries who oil the wheels of dubious practices. No government is ever going to succeed in tackling tax avoidance without shackling the tax avoidance industry operated by lawyers, big accountancy firms and finance experts. The government needs to bring more legal cases and prosecutions so that the law is tested – and remedial legislation, if needed, can be quickly enacted. The minimum fines on the advisers designing and selling the scams should equal the tax lost and persistent offenders should be shut down.

A well-resourced and robust HMRC is necessary for challenging the might of the financial elites and their addiction to tax avoidance, but its capacities have been consistently undermined. In April 2005, HMRC had staff of 104,670 and a budget of £4.4bn, compared to a staffing of 61,800 in April 2017 and a budget of £3.8bn. This is a massive reduction in real terms. Unsurprisingly, HMRC has investigated only 72 high net worth individuals for potential tax fraud since 2011, and there has been only one successful prosecution.

An even bigger problem is that HMRC is colonised by the tax avoidance industry and large corporations, who dominate its operations and are, in effect, allowed to write tax law. This inbuilt capture needs to be addressed by a creating a supervisory board, consisting entirely of stakeholders and citizens, to oversee HMRC’s executive board. The supervisory board would meet in the open and interrogate the executives about matters such as the development of a public register of trusts, failure to investigate elites and bring prosecutions. The supervisory board should also become the port of call for whistleblowers.

None of what I propose would offer a magical solution to the deeply embedded problems of tax avoidance, but would help to begin the development of an antidote.

• Prem Sikka is professor of accounting at the University of Sheffield and emeritus professor of accounting at the University of Essex