Offshore review holds no fear for Jersey chief

Robert Kirkby, technical director at Jersey Finance

A director at a UK offshore tax haven has rejected speculation that a government review of Crown dependencies announced in the pre-Budget report earlier this week would scare off rich investors and threaten the future of offshore jurisdictions.

While details of the review have yet to be released by the Treasury, some experts believe the review will focus on pressuring havens to be more open and provide more financial information to organisations such as the Organisation for Economic Co-operation and Development (OECD) to help combat money laundering and tax evasion.

The announcement of the review, which is due to be completed next spring, comes amid moves by European leaders and US President-Elect Barack Obama to crackdown on offshore tax havens.

But Robert Kirkby, technical director at Jersey Finance, said he was not worried by the review.

‘We regard the Treasury’s review simply as a health check. The announcement didn’t come as a huge surprise,’ he said.

He added that he was confident Jersey, a leading offshore financial centre, would demonstrate a ‘robust, regulatory regime’ that complied with international standards.

Kirkby said he was unaware of any deposit shifting in Jersey over the past couple of months as this is reported quarterly.

Richard Murphy, tax campaigner at the Tax Research Network, said investors would start withdrawing funds from some of the smaller offshore jurisdictions, such as Jersey and Guernsey.

Murphy ­ a long-standing critic of tax havens — said Jersey and Guernsey’s heavy reliance on financial services and securitisation markets would lead to their closure.

John Thurso, Liberal Democrat MP for Caithness, Sutherland and Easter Ross, and a senior member of the Treasury Committee, said: ‘The consequences, particularly for the Isle of Man and the Channel Islands, are that we could destroy their economies and turn them into nothing more than benefit havens.’