麻豆社

It is fair to say that governments don鈥檛 pay much attention to what banks are up to when times are good.

But with the implosion of the UK鈥檚 banking industry and tax revenues drying up, the financial world is now the subject of intense scrutiny.

The fall-out has resulted in prominent world figures 鈥� most notably President Barrack Obama 鈥� pledging to investigate so-called 鈥渢ax havens.鈥�

According to one estimate tax havens cost the UK revenue at least 拢18.5bn every year.

President Obama

Jersey status as a financial centre was recently investigated in a 麻豆社 documentary, Panorama 鈥� Tax me if you can.

麻豆社 Jersey talked to local figures on both sides of the argument.

鈥淰eil of secrecy鈥�

Director of Tax Research LLP, Richard Murphy, was one of the advisors on the Panorama programme.

Speaking to 麻豆社 Jersey Mr Murphy said the term tax haven was misleading.

Mr Murphy said: 鈥淲e call them secrecy jurisdictions. They are places which deliberately pass legislation that undermines the rules of another state.

鈥淭hey create a veil of secrecy to ensure that people who use its rules cannot be discovered to be doing so by the country they鈥檙e are actually based in.

鈥淛ersey is without a shadow of a doubt in this group. It is the leading tax haven to service the city of London.鈥�

Chief Minister Terry Le Sueur

Mr Murphy challenged Chief Minister Terry Le Sueur鈥檚 assertion that Jersey was transparent and well-regulated, describing such statements as 鈥渁 joke.鈥�

He said: 鈥淵ou can't find out anything about what happens in Jersey regarding corporates because the information doesn鈥檛 have to be put on public record.

鈥淛ersey bluntly refuses to voluntarily exchange information under the EU savings tax directive.鈥�

鈥淭he island has got to fundamentally transform itself to become a part of the international financial community.

It has to fully embrace the EU savings tax directive and put all the information on companies based in the island on public record.鈥�

Well regulated

One body that disputes the term tax haven is Jersey Finance 鈥� the organisation that promotes the island's finance industry.

Jersey Finance鈥檚 Technical Director, Robert Kirby, condemned the Panorama documentary as too one-sided.

Robert Kirby said: 鈥淛ersey has applied a number of measures over the last decade to ensure we meet international standards.

鈥淔or example, we have complied to the third EU anti money laundering law to make sure money here isn鈥檛 used for tax evasion. This is the EU standard, which is applied by 27 other member states.鈥�

鈥淲e have also complied with the EU on tax competition. We were challenged over our tax regime and that鈥檚 why we have introduced zero-ten.鈥�

Mr Kirby said that despite income tax and GST Jersey was still a low tax island.

Jersey - Tax haven?

鈥淲hen you look at our overall tax rate, which is 20 per cent plus 3 per cent GST, and compare it with the rest of Europe we are quite a low-tax place.

鈥淚n the UK you pay up to 45 per cent tax pus 15 per cent VAT.鈥�

Mr Kirby said Jersey has worked hard to shake off the tax haven label, but didn鈥檛 agree the island needed to do more.听

Mr Kirby said: 鈥淲e also believe the UK and EU member States should help promote Jersey鈥檚 reputation as an international finance centre, not a tax haven.

鈥淚 don鈥檛 agree that Jersey needs to do more. We have met international standards and we have had good, albeit informal, feedback from the International Monetary Fund.

鈥淲e expect their final report to consolidate our position as an international finance centre.鈥�

Have your say

What do you think? Is Jersey a tax haven, or is it simply a place that is geared towards international finance? Does it need more transparency, or should it be left to get on with it?

Y Hughes

Maybe not a tax haven but along with other offshore tax centres we helped facilitate the shadow-banking industry which led to the "originate and distribute" model of reckless lending.听 These structures get around normal banking controls and have been the driver of much of the credit boom of the current decade.听 Certainly not something to be proud of but then we were all caught up in it.

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Mark G - St Saviour

Is Jersey a Tax Haven? Yes

It does not matter how much regulation is in place the mega rich and large multi-national always find a loophole.

If Jersey is so regulated then why are we now seeing in the news of various companys and banks who have been found out regarding thier involvement with Tax evasion.

The issue here is not about the off shore banking but about local governments losing out on billions of tax revenue. If the UK or USA want to reap this back then why not introduce new laws in their own country to stop this happening?

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Marx - St Saviour

The fact is, business come here because they know they will pay less. Forget what the definition of a tax haven is, what we are doing is immoral.

Ordinary poreletariat folk are having to pay more taxes, because the bourgiousie, who have more money then they could ever care for, are selfish.

Jersey will keep doing it, because its beneficial for us, but they don't realise its detrimental to other people! But when has the Jersey government ever cared about anyone but themselves...

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Michael - St Saviour

Richard Murphy is incorrect about compliance with the EU Savings Directive; Jersey has legislated to ensure that from 2005 new accounts opened by EU residents will be subject to an Information Exchange (IE) with their domestic tax authorities, whereby their income details are reported. Existing clients had/have the option of IE, or they may pay a withholding tax that will periodically increase over the next few years. Although their details will remain confidential, tax is collected and distributed to their domestic tax authorities. However, WHT will increase to such a rate that it will eventually become more efficient for account holders to declare their income under the IE scheme.

If Obama wants to shut offshore centres, I suggest he starts with Delaware.

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Paul - St Helier

The show was so poorly put together. Jersey is a finance centre playing by the rules.. has agreements with many countries including Germany and the US.

On the other hand you have Switzerland - that still has numbered bank accounts to start with!

Yes there are some dodgy tax jurisdictions - British Virgin islands, Cook Islands etc.
They should concentrate on the real tax havens and leave Jersey alone.

I thought there was a law about peoples privacy... can we see on public record who owns a car if we know its number plate? Can you in the UK? No - so why should we know who owns a Company? Talk about moving the goal posts!