The man responsible for the Isle of Man at the United Kingdom’s Ministry of Justice has confirmed the VAT arrangement was changed because the Island gained too much from the previous deal.
Under the re-drawn revenue sharing rules, the Manx government will lose almost £100 million from its budget next year, and £140 million annually after that.
The reasons behind the change have been the subject of intense debate in Tynwald this week.
Lord Bach spoke to journalists before giving the Chief Minister’s International Lecture at the Hilton Hotel last night.
He said the Island had benefitted from an extremely good deal which had to end
Of course it had to end: it was a wholly unjustified subsidy – as I always said.