TaxPersonal TaxTax haven islands reject OECD reforms

Tax haven islands reject OECD reforms

The Channel Islands and the Isle of Man have said they will not reform their tax regimes unless other countries with similar systems are made to follow suit.

The three Crown dependencies claimed the European Union was being unfair and immoral for supporting their inclusion on a list of harmful tax havens prepared by the OECD.

But the list omitted countries with attractive tax regimes such as Switzerland and Luxembourg.

Frank Walker, chief finance minister of Jersey, said: ‘This smacks of protecting the big jurisdictions and attacking the small ones.’

As part of a global crackdown on tax evasion, the OECD has asked 35 offshore financial centres, which include Jersey, Guernsey and the Isle of Man, to co-operate and revise their tax regime within a year or face economic sanctions.

Britain has endorsed the report’s conclusions, including the threat of economic sanctions against jurisdictions that fail to co-operate with a global crackdown on tax evasion.

Following their annual meeting in the Isle of Man, the three regions said they were ready to co-operate with the OECD but were still unclear what the organisation expected of them.

The hostile reaction is sure to embarrass the Treasury which had asked them to co-operate to avoid punitive action.

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