Leader - Getting all tangled up in the Web
It’s not just the government that is struggling with the uncertainties thrown up by the Internet revolution; from practice to business, e-commerce is proving to be a headache for accountants.
As ministers and odcials struggle to catch a belated ride on the Internet bandwagon – there is still no movement on the appointment of a digital envoy and the long-awaited E-commerce Bill has yet to surface – tax advisers are struggling to grasp the taxing complexities of the new environment.
Finance directors, meanwhile, may not quite know how to react to the e-commerce revolution but they know they don’t want to miss out.
In the face of this uncertainty, the Isle of Man has stepped in. This week the Manx government sought to take the lead by granting a licence to create the world’s first global Internet bank.
That sort of decisive action contrasts sharply with an Institute of Directors report, also out last week, which warned government consultation on online tax issues was not being matched by government action.
Without tackling the admittedly difficult area of online tax – how do you determine domicile in cyberspace, for instance – tax advisers will only be able to direct clients to locations that have identified solutions, such as the Isle of Man.
And those clients will either follow that advice and leave the UK trailing, or, worse still, ignore it and keep their heads in the sand.