Guernsey ‘has cost UK millions in dodged tax’
Tuesday 3rd March 2009, 2:30PM GMT.
GUERNSEY has cost the UK almost £48m. in lost tax over the last three years, the Trades Union Congress has claimed.
The TUC has urged ministers to clamp down on ‘tax havens’ such as the Crown Dependencies.
But States tax adviser Jonathan Hooley (pictured) said the claim – that offshore avoidance cost the UK £4bn a year – was based on assumptions.
The TUC had assumed that all UK residents with money offshore were paying tax at 40%.
‘Some would be taxed at a lower rate,’ he said. The TUC had also assumed that all investment returns would be taxed at 40%.
‘There could be lower rates of tax applied,’ he said.
The TUC said that data given in Parliament suggested that £319m. of tax had been lost, more than £211m. to the Crown Dependencies, over the last three years. But it believed that much more money was held offshore than was known.
General secretary Brendan Barber said: ‘If the super-rich held their money and assets in the UK, they would contribute at least £4bn. extra.’
Under the EU’s Savings Tax Directive, UK residents with offshore accounts can either declare all of their interest to the Revenue or have 15% tax withheld from interest payments by the jurisdiction in which the account is based.
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Makes one think doesn’t it? all that money, and people assume that it is Guernsey that benefits from it.
So with a disastrous ruling body that Guernsey has, who bends and kisses…….. to what avail
Not for the benefit of Guernsey it’s quite obvious, And it still goes on.
When will this States of ours come to their senses and see through all these bluff experts, and truly do something for Guernsey, instead of not only buttering the bread of the already greedy rich, but they also smear with >Jam.
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Utilising the existing legislation, I think the term is Tax Planning, not dodging!
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These TUC figures all came from Richard Murphy who would like to see the demise of the Channel Islands.Murphy is flexing his muscles and trying to bait the Politicians of Jersey he seems to be on a mission for many years. INVITATION TO A PUBLIC SEMINAR
on Thursday 12th March, 2009 – 6,45pm
LOCATION: St. Paul’s Centre, Dumaresq Street, St. Helier (Upper Hall), Jersey
Offshore financial centres: past, present, future
Why major reform is vital
As the global economic crisis unfolds, the activities of hedge funds and the shadow banking system are coming under increased scrutiny. Leaders of the G-8 and G-20 countries are calling for stricter regulation of the financial system. Some of them, including Presidents Obama and Sarkozy, Chancellor Merkel,Dominique Strauss Kahn at the International Monetary Fund, and others, have noted the role that tax havens have played in hosting this shadow banking world, and are calling for strong measures to remove these weak links in the regulatory chain, and put an end to the tax avoidance industry. Pressure for major reform will increase as the crisis deepens and widens to other economic sectors and regions of the world.
[...]
It has become clear to everyone that the global banking industry does not currently serve public interest. It is over-complex. It lacks operational transparency. Attempts to regulate its activities are fragmented and weakened by the laxity of regulation in offshore centres like London and its small island satellite havens. We urgently require new strategies to preserve jobs and generate lending that will serve useful social and environmental goals. We hope that the people of Jersey will recognise that they can play a positive role in this process and we invite them and their elected representatives to join us at our meeting at 18h45 on 12th March 2009.
This invitation was mailed to every Member of the States of Jersey on 20th February 2009
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I worked in Guernsey for 6 months when I was 19.
I am a British citizen and have lived in Enland for all of my life.
The best 6 months were when I was in Guernsey. The Labour Government has totally ruined the UK so as far as I’m concerned if people are sensible enough to invest their money in Guernsey, well good on them. I’m fed up with my taxes going on people that do not deserve them and would simply love to move back to Guernsey. Unfortunately I cannot afford to do that !
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The EUSD tax rate is 20% not 15%
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According to recent research by a well respected organisation, Guernsey actually cost the UK tax payer £3.75 in the year ended 31 December 2008. No really, this is a well researched and accurate figure and I shall make a speech to that effect and hopefully it will get published in the national newspapers.
OK so its nonsense – but the point is anyone can come pluck figures out of the air with no actual evidence and bandy them about and even get them publicised in the media – just as I have done here.
Once again we are being accused of ripping off the UK taxpayer with no material evidence. Once again the media is happy to publish this misinformation as if it is fact.
It is illegal for a Guernsey financial services provider to conduct business which results in the evasion of tax which should rightfully be paid in the UK. We do not carry out such business. We provide services for clients who have no legal obligation (under UK tax legislation) to pay tax in the UK therefore we are actually costing the British taxpayer nothing.
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Where is his proof. I am afraid the UK is lost now and just makes allegations that frankly may or may not be true- are they still searching for WMD in Iraq?
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Eric
Lashing on butter and jam? More like Guernsey butter and Caviar!
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Eric
I believe the local finance industry provides good employment to several thousand Guernsey residents,without whose local income tax payments we would be in a real mess
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well Ray ask all the young people of Guernsey birth that have had to move off the Island because of over priced houses.
Guernsey is nothing more then a support base for the rich to lord it over the island, you only have to look at your election results to see who owns who! just ask the people of Sark!
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Who do they think they are? Is Switzerland next? I think its time we completly distance ourselves from the UK so that they do not bring us down with them. What do they give us?
A lot of Brits have left their excuse for an island and now live in Europe/elsewhere with their money offshore.
Lewis Hamilton now resides in Switzerland…tax planning is not the same as evasion..did not take him long to fly the Swiss flag
As for the TUC…biscuits the lot of them
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werner…compare that to the millions of Brits who have left and now live elsewhere and not contributing to the UK economy??
48m in 3 years is a drop in the ocean compared to how much the Trade Unions cost the economy through strikes, official actions etc…How much does the TUC cost?
Sorry..they are their as a voice for the workers…an expensive voice given their leaders flash London homes
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Im 19 and the way i see it many young people i know depend on jobs in Finance and i dont know one person my age of”Guernsey birth that have had to move off the Island because of over priced houses”.
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Werner – Today’s homeowners were yesterday’s youth of Guernsey. I think you’ll find the young people of Guernsey would have no trouble in getting on the housing ladder if they just worked a bit harder and didn’t spend their monthly income down the pub.
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AC
Good comment, you are so right.
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As a young guern (under 25) i have owned my own home for 2 years – bought it with no financial help from anyone other then the bank – and guess what i worked for the dreaded finance monster too! For all ye olde folk who think finance is a monster – think about how many people will be out of work without it – then see what a mess we will be in – sure its not perfect but what is these days. Alot of my friends from school who went to uni (paid for by Gsy) have tended not to return to gsy for reasons like life experience or speciallised careers not available in guernsey – nothing to do with house prices-how do i know this – from when we catch up down the pub of course!
To satisfy the old timers who are against change lets go back to growing toms and flowers and see how long it is until the island become dishevelled and sinks into a real problem – then we will see the young exodus en masse!
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But SDG! I’d like to return to Guernsey when I graduate, but my starting salary as a healthcare professional means I won’t even be able to afford to rent a car parking space let alone an entire house.
I mean, did you REALLY want to work in finance when you were at school? Did you daydream in lessons about being an accountant? Or did you sell your soul to a big bank as that was the only way you could afford to live in Guernsey?
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The trend in Guernsey is for Mum and Dad to remortgage their home to finance the kids hope of owning a home..really this rubbish about trade unions costing the economy in lost money/ productivity has to stop! wake up we are in the middle of a world wide financial train wreck which is the result of greed,tax minimalism schemes and of course deregulation of the industry which allowed all this to happen.
Finally what ever as happened to the laboring class, don’t you count unless you have been to uni.
Hey Pablo I wonder how many of those Brits live in the Channel Islands enjoying your status of a tax haven..
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Be sure that a lot of high up Union officials also have money salted away in so-called tax havens, just as a certain Minister of the Crown who was always ranting on about Guernsey did; he had massive amounts of money invested in Guernsey’s banks. One thing about most of those investors though is that, unlike ANY Union official and MOST Union members, they darned well EARNED their money! Certainly, taxmen and other money grabbing officials would like to get their foot in Guernsey’s door.
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Why the tax amnesties if we ‘are costing the UK tax payer nothing’?
Surely an amnesty is an admission by ‘offshore’ clients that they have not disclosed what they ought to have done. Surely therefore we (as an offshore centre) are aiding this non disclosure? Or do we not care?
Let’s get those ambassadors out to say how much we care.
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Student Bob-as it happens no- i didnt sit there and dream of being in finance – quite the opposite in fact – and as you will see in my previous post “I worked” i am now a happy civil servant – earning no where near what i was on the bank-but working in finance was an ends to a means – once i had the foot on the ladder i could afford do take a drop in pay and do what i wanted not what i had to to get my home. i have the upmost for healthcare professionals, firefighters, police officers and charity workers etc – who do their jobs for love not money – but im afraid i have zero sympathy when they complain they dont earn enough to have their own homes and cars and hols etc, you make a lifestyle choice by entering into those positions knowing that you wont earn a fat salary and bonuses. Also who is paying for your university study, i bet it is at least part paid for by the States of Gsy? Do you think they would have the money in the pot to cover that if finance left and revenue dropped-unemployment surged? i think not.
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Good reply SDG
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Nice work SDG.
I hate my finance job but the monetary rewards mean that I can have a reasonably comfortable, but far from extravagent lifestyle.
I’d be much happier doing something else but that is the choice I have made.
Student Bob, who CAN afford to buy a house on a starting salary?? Most people are realistic in understanding that you have to put a good few years in to be able to get on the ladder. I wish you luck in your chosen field. (And that is not supposed to sound sarcastic)
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Fast Robert says “Surely an amnesty is an admission by ‘offshore’ clients that they have not disclosed what they ought to have done. Surely therefore we (as an offshore centre) are aiding this non disclosure? Or do we not care?“
The response of David on the Landsbanki thread might shed some light on this murky subject.
“If you were opting for withholding tax then does that mean that you were illegally evading tax in your home country ? It rather suggests that you were. By the way, if that’s the case then you would have been committing a criminal act of tax evasion and so are on very dodgy ground indeed”
Seems there may be bags of loot about sans appropriate tax. It also seems Guernsey is aware of tax evasion and has done nothing.
Not the sort of information Senator Levin of Stop the US Tax Haven legislation fame should be hearing. Tends to vindicate their stance of sod the words, lets see what is happening in practice.
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SDG -So to briefly summarise your point – if you want any quality of life you need to work in a bank and it’s your own problem if you want to do something ‘more meaningful’.
I totally agree, and that makes me sad for Guernsey.
Does that really create a balanced and healthy society? Or has Guernsey become a one trick pony and an increasingly lame one at that. They shoot horses you know.
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Thanks Russ – also a good point about who can afford a house on their opening salaries. In any industry even finance you start off low and as you work hard and progress the reward follows-perhaps student bob has it a little too good at home and is used to having what he/she wants when he/she wants? Also SB – my job in finance was far from boring and actually really enjoyable, opened my eyes to alot of things and introduced me to hundreds of interesting people from all walks of life, that was until the credit crunch hit and it got boring being a mortgage adviser with noone getting mortgages!!
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Im afraid the most countries in the world tend to rely heavily on one area or another. I would challenge you to find a jurisdiction that has multiple income streams that it could rely on should one of their others collapse?? And no you dont have to work in a bank to have a quality of life. You may have to sacrifice somethings for others depending on whats important to you. As i said I managed to get my own home with no financial help at all (apart from paying standard board and lodgings to my parents as opposed to high rent) and now I earn £10k per annum less then i did in finance, no bonus and no health care – but I have a 9-5 rather then 8-8 and in actual fact am having the best time of my life since I left Uni-so its quite the opposite- i have a great healthy balance of work and life. Maybe im just lucky, who knows!
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Student Bob
Or put them in the circus.
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SDG – You are very lucky. Perhaps you could have a word with Russ and sort him out with the ‘really enjoyable’ job you left eh?
I accept your challenge. I’ll take France, after all, on a clear day you can wave at them and watch them plying their trades in import/export of manufactured goods, agriculture, tourism, energy production, finance, defence, aerospace, onions, garlic, berets and nice wine. Do they have one defining industry that dominates the country and upon which they are dependent? (I also opened the Student Bob Book of Socialism and first country on the list was Afghanistan, they have a diversified economy based on illegal drugs, finance and mining).
Anyhoo, I digress from our original digression. Do you really truly believe that the sacrifices that Guernsey people make, whether it is working jobs they hate, or taking huge pay cuts to work a job they like is fair? Wouldn’t you prefer to be earning ‘bank’ money in your civil service job? Would you not agree that the disproportionate remuneration available in the “dreaded finance monster” has created this situation?
(Bob, by the way, is a boy’s name).
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Fast Robert
They’re already in a circus!
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What about the money that Guernsey has spent paying for students to attend University and not return to the island but remain in the UK putting money into the UK economy and leaving Guernsey with the bill for their 3/5 year of education in the UK.
As far as I’m concerned students should all have loans from the states for university education and if at the end of their education they return to the island and spend a specified amount of time being a taxpayer on the island have their loans written off otherwise should they decide not to return to the island they should be made to pay back the loan.
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Student Bob – the main “industry” in France is the public sector! But your point is taken.
Spare a thought for Jersey as their economy is even more reliant on finance than ours. Nah!
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Bet the TUC has cost the English economy more than that!
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BB – totally agree!
Gilthead – Interesting point, perhaps when Jersey goes belly up we could buy that, instantly providing a solution for our waste disposal problem?
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(Bob, by the way, is a boy’s name).
….unless you watch Blackadder that it… ;-)
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If the loss of 48 million over 3 years broke the UK economy then they were totally screwed anyway.
Nice that Mr Brown and friends are blaming other jurisdictions for the mess his country it in. They make it sound like without evil tax havens that the UK wouldn’t be in recession. I call shenanigans.
Stop pointing the finger and take some responsibility for your own actions…
Same goes for our elected “leaders”.
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What a load of rubbish – is probably five times that much, at least.
Try over £250m.
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Student Jim has got the right idea.
The English government (and country) is an utter waste of time. The further you Guernsey folk place yourself from it, the better. A house of incompetent idiots with a hidden agenda. Blaming others, presiding over a mess of their own making.
Is it any wonder that anyone with a bit of cash is leaving? I live here in Blighty, but my money doesn’t!
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As a Guernsey man based in the UK, please be very aware that this Labour Government has frittered away money on folly like no other administration before. UK plc is broken vessel and in serious debt, also with a greater part of the UK banking sector throwing everything that looks like vaguely suspicious on the fire as bad debt, UK plc is very unlikely to see tax income stream from that sector for some time.
So now that times have that desperate edge be very aware of any protestations from the incumbent at number 10. As ‘Flash’ might be saving the world but I don’t think he cares a damn about the Bailiwicks if he thinks there is any unspent revenue hiding there.
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