Saturday, 14 August 2010

The Crown Dependencies: time for the Treasury to take an interest

The United Kingdom government has got its work cut out to balance its books, not only to scale back the annual budget deficit but also to reduce all the "off balance sheet" debt accumulated and hidden under Gordon Brown's reign at the Treasury and Downing Street: 13 profligate years in all.

The Liberal Democrats are in government on the basis that they will push for "fairness" in where taxes are raised and services curtailed. In that case,they - and Parliament - should take more of an interest in the "Crown Dependencies", the feudal relics of the Isle of Man and the Channel Islands.

Go on the Internet and you will find extraordinary amounts of overpaid legal faffing about these strange backyards. The simple truth is this: United Kingdom governments quietly license these local offshore territories to act as tax havens for rich people, many of whom would otherwise be UK taxpayers or more of UK taxpayers than they presently are. Live in the Channel Islands or the Isle of Man and you don't have a vote to send an MP to Westminster - and as the quid pro quo, you don't pay UK taxes. It's a no brainer. Taxes are lower or non existent in the Crown Dependencies; who cares about having an MP? And they are near enough to allow you to commute back and forth without hindrance to your office in London.

It's almost as simple as that. And the solution is almost as simple: Parliament should offer these offshore tax havens either the choice of complete independence from the UK - which would cost them, since at present we do a lot of the leg work to keep them in business - or incorporation into the UK and its tax system, in exchange for which they get to send their MPs to Westminster.

I am being generous really. On another day, I might say: just incorporate them. That's what any country really committed to fairness would do.

No comments:

Post a Comment