BOTH JERSEY AND THE ISLE OF MAN have rejected suggestions they facilitate tax avoidance and evasion, ahead of next week's G8 summit in Northern Ireland.
Both claim recent international pressure put on them is politically motivated, adding they are more open about their tax systems than they are given credit for, the BBC reports.
Tackling tax avoidance and evasion is expected to be high up the agenda at the summit, with the focus thus far on small, offshore jurisdictions, including Jersey and the Isle of Man (pictured).
In May, it was announced all the UK's overseas territories are now signed up to automatic information-sharing deals, with a pilot currently underway. The deal sees the UK, along with other countries involved in the pilot, automatically provided with much greater levels of information about bank accounts held by their taxpayers in those jurisdictions, including names, addresses, dates of birth, account numbers, account balances and details of payments made into those accounts.
Despite the continuing pressure, leaders of perceived tax havens are suggesting G8 leaders should get their own houses in order.
"Politicians love scapegoats," said the Isle of Man's chief minister Allan Bell. "And the G8 agenda is being politically driven because there's always someone else to point a finger at."
He added that the US in particular is practicing double standards in its rhetoric about tax avoidance and evasion.
"We just want a level playing field when it comes to tax transparency. It's totally selfish from the USA because they want to track down their own tax evaders overseas, without looking at Delaware," he said.
Delaware is one of the US's least populous states, with only around 900,000 residents. However, more than a million companies are registered there.
Both the Isle of Man and Jersey charge zero corporation tax for foreign-owned companies, but Jersey's Treasury Minister, Philip Ozouf insisted the island's tax code was just as robust as the UK's.
"I'm not going criticise the decision of democratically elected governments or parliaments," he said.
"I'm leading the kind of charge against tax evasion here that the UK chancellor is doing to UK residents. We expect our taxpayers to comply with all tax codes just as much as the UK does."
"Both the Isle of Man and Jersey charge zero corporation tax for foreign-owned companies"
This remark is about a decade out of date. I expect the BBC to get it wrong, but it would be nice to think that Accountancy Age would be slightly more accurate in its statements.
Firstly the Isle of Man doesn't charge "Corporation Tax" on companies it charges "Income Tax" and secondly the ring-fencing of foreign owned companies to allow them to gain an exemption from income tax disappeared many years ago.
Today almost all companies pay income tax at a rate of 0% (including those which are locally owned), with the major exception being Banks (almost all of which are foreign owned) which pay income tax at 10%. The only other companies paying income tax are those with rental income from Isle of Man property and the largest retailers (also mainly foreign owned).
Posted by: Michael, 14 Jun 2013 | 12:53
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