This from the full Pre Budget Report:
Many crown dependencies and overseas territories are significant financial centres in their own right and the financial sector plays a vital role in their economies. The Government recognises the progress made by most offshore financial centres to improve financial regulation and transparency, and tackle financial crime. However, crown dependencies and overseas territories, like all offshore financial centres, face challenges and opportunities as the world is changing. In particular, severe financial turbulence has raised questions for all jurisdictions, while there is growing international pressure to line up standards of financial regulation and meet international norms with regards to taxation.
The Government will shortly commission an independent review of British offshore financial centres; their role in the global economy; and their long-term business strategies. The review will not consider changes to the UK's constitutional relationship. It will work with the crown dependencies and overseas territories to identify current and future opportunities, risks and mitigation strategies, including issues such as:
- financial supervision and transparency;
- fiscal arrangements;
- financial crisis management and resolution arrangements; and
- international cooperation.
In the light of comments Alastair Darling made about the Isle of Man a week or so ago I do not think there is anyone who can doubt his intentions: the mood of Barack Obama has reached Whitehall.
This is not a token: this is an indicator that real change is on its way.
As he made clear: it is now very obvious that these places seek to undermine tax revenue but cannot provide investor protection: they demand services and do not pay for them. The world can no longer afford them. The question now is not how reform happens, it is a matter of when it happens. It is not a question of whether they comply with regulations, it is a question of whether the regulations we have are appropriate. And it is not a question of whether their tax strategy is appropriate or not, it is a question of how they are required to comply with international norms which they currently seek to undermine at cost to us all.
Exciting times. He got this bit right.