One of the regular commentators in this blog is a Guernsey based tax practitioner (I think) called Rupert — which could, of course, be a pseudonym.
He said in a comment on a recent blog that:
I admit I certainly could not have imagined [recent events] happening last November. … But be honest - its far from what you wanted. You wanted to completely destroy the offshore world and particularly the Channel Islands and the Isle of Man. Your spin on things is to be admired - you are clearly learning some skills from all of your dealings with politicians - but even a cursory glance of this site clearly shows just what you wanted.
I don't believe that you will ever actually reach you utopias of outlawing nil-tax offshore jurisdictions or global tax harmonisation, but on the other hand I have little doubt that by 2015 you and your colleagues will have played an instrumental role in making offshore a more sustainable place for the few who are prepared and able to play to the new rules.
I personally would call that a decent result, but would you ?
In fairness, there’s much more than that which I have less to argue with (probably). The above is enough.
So let’s be clear, I want to eliminate secrecy jurisdictions. No if or bust here: that is the stated aim. But this leaves ma a mile removed form the assumptions Rupert makes.
I almost never raise the issue of tax rates. I made the point in an interview with the German paper Die Zeit today that tax rates are not an issue for me. I said that if a place can offer low tax rates with the approval of its electorate who accept a low level of service in return and it can do so without abusing the taxing rights of other states, so be it. I can afford to be this relaxed: I know the tax havens / secrecy jurisdictions can’t do this and will have to radically reform, and probably receive serious aid to find a new role for themselves in the world.
But let’s be clear: I argue for that aid when appropriate. I want these places to survive.
To argue that my objectives are to destroy the Isle of Man and the Channel Islands, to undermine democratic choice on tax havens or to impose global tax harmonisation is wrong. Completely wrong.
I argue for an end to secrecy so we can eliminate corruption and have efficient markets for the well-being of all. That does require proper regulation. Only a fool denies that now. Proper regulation of tax is part of that — harmonisation of rates is not.
So of course the G20 is not failing me in pursuit of these objectives — these are not my objectives. Please stop the spin — I don’t deal in it. It’s only the spinmeisters who accuse me of doing so because they’re not used to talking to a man who deals straight.
As the conclusions — I heard the same from Tim Ridley, former chair of the Cayman Islands Monetary Authority a year ago. It may be right. And yes, it would be progress. But only if the survivors work without a veil of secrecy. While that remains we can never have efficient markets and the abuse of the developing world and the poor at large will continue.
And that’s what motivates me to continue this campaign, whatever others say.
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Bravo Richard, well said.
It would appear that the enigmatic Rupert has a chip on his shoulder about something. Or maybe he doesn’t properly understand why people want to use HMRCs statutes to move the jurisdiction under which their personal and business assets and income streams are subject to taxation (or not as the case may be). If they can do so using existing legislation then why try and employ secrecy and subterfuge?
What I object to is HMRC’s scaremongering and the PM’s assertion that there is something wrong with legitmately avoiding taxation.
If they are so worried then let them change the legislation that is being used. If they can’t for some reason then they should shut up.
Tax Avoidance Regs are there to stop people from being secretive about how they are doing what they do and hurrah for that because what they do is usually rubbish; however if the strategies used are all reported and accepted then they cannot possibly be “illegal” in any way shape or form.
We’ll have HMRC saying next that to use the maximum permitted pension contributions to reduce taxable company and personal taxation is to be outlawed – pahhhh!
Rex
Yes – I have a so-called “chip on my shoulder” about well-regulated jurisdictions, and totally compliant financial services providers within those well-regulated jurisdictions, being accused of all kinds of things without any tangible evidence, and by people who simply are not aware of the very high standards (and I’m talking tax compliance standards) to which we operate. I think that’s justifiable.
And I agree with the rest of your posting !
Rex
There is something wrong with tax avoidance. It may be legal, but it iis thoroughly antisocial
Let’s be clear though – tax avoidance is the sort of activity at Barclays bank is pursuing and which has received a lot of publicity today.
Tax compliance involves claiming your pension contribution. That is quite clearly within the spirit of the law and is endorsed by Parliament.
Can we keep the debate that a sensible level? tax avoidance involves getting round the law. tax compliance means just that – claiming the benefits that the law wishes you to have in accordance with the economic substance of the transactions that you have undertaken
Richard
Richard, I think one of them main problems why a lot of people have problems with your views is because you claim that the main business of the crown dependencies is tax avoidance. That is no longer the matter.
The vast majourity of financial services in Guernsey, Jersey and the Isle of Man are to do with fiduciary, legal and funds not tax avoidance. Note that all services are well regulated and transparent. In terms of transperency I know for a fact that the OECD considers Guernsey to be of a higher standard then the US and UK.
On a personal note, I also find some of your remarks about the Channel Islands fairly insulting. We have a unique culture and heritage, far different then the UK, and have had indepedence since 1204. To say for example, that Guernsey is just another ‘UK seaside town’, really does get the blood boiling. I feel that if you want to get your points across, its time you take a far more neutral stance and bring more facts and statistics to the table. Because from where I am, both G20 and the OECD completely disagree with your opinions.