From the air, the tiny circle of Guernsey sparkles from scores of greenhouses dotted in a quilt of small fields. Close up, the greenhouses lie derelict and trees rampage through their dilapidated timber frames. As these monuments to the island's tomato-growing industry — which collapsed in the 1970s — fall into disrepair, they are being replaced by the gleaming metal skeletons of new warehouses. Like the wealthy people who live tax-free lives on Guernsey, these warehouses are exceedingly discreet. HMV's depot is tucked down a tiny, unsignposted track. Moonpig's headquarters is not signposted from the main road. These shadowy buildings are an almost invisible tip of a new industrial boom on the Channel Islands: the euphemistically named "offshore fulfilment" industry.
Yes, you’ve heard it before.
But without doubt there's enough tax lost here to pay for school sport in the UK.
Another wrong choice by the Tories.
Thanks for reading this post.
You can share this post on social media of your choice by clicking these icons:
There are links to this blog's glossary in the above post that explain technical terms used in it. Follow them for more explanations.
You can subscribe to this blog's daily email here.
And if you would like to support this blog you can, here:
Buy me a coffee!
If you want a laugh read the comments under the article. It seems that VAT abuse deniers will use all kinds of ludicrous arguments to ignore the fact they have a 17.5% (20%) advantage. In the article 7 Day Shop argue that they are much cheaper than anyone else and the VAT has nothing to do with their success and then they go on to claim its more expensive shipping stuff to Jersey. So why would you do it then ? The usual ‘Its good for consumers argument’pops up. I’m sure drug users could come up with some good things to say about taking drugs but that would hardly be justification for supplying them (but the customer enjoys it!).
I know it’s not your words, but it’s not helpful to perpetuate the myth that Guernsey is some kind of paradise where *everyone* is super rich – it’s simply not true. There are normal people who live there, many of whom would be wholly supportive of your point of view if they weren’t so brazenly misrepresented by the media and commentators.
A shift in public will (Guernsey is not a 2 party system and is much more representative than UK politics) would be an effective way of changing the Guernsey legislation on this, however, considering the fact that many working people rely heavily on 7dayshop, HMV and so on for their wages it would be hard for them to be complicit in their own redundancy.
@Doug Did I ? I don’t recall perpetuating a myth about everyone being rich in the CI ? Where ?
@Doug Also this has nothing at all to do with Guernsey. The UK allow it and certain individuals in Guernsey exploit it. Anyone exploiting this who doesn’t realise its impact on the UK is frankly stupid or deliberately blind to the consequences. I agree that its terrible that people have to rely on such a business. I know people who have lost their job from a UK internet business who had to close because of LVCR competition. What do you have to say to them ? How does your concern for jobs that are based on LVCR stand up against someone who has lost his job because of VAT free competition in a country where everything is supposed to include VAT ?
Pushing this quote: “Like the wealthy people who live tax-free lives on Guernsey” in your post is perpetuating the myth that people in Guernsey are all wealthy – which is absolutely not true, most people in Guernsey are in fact quite the opposite.
Don’t get me wrong, I agree that the exploitation is wrong and it costs jobs in this country – I’m just not seeing an alternative coming through. I accept the need to close the loop hole, and ensure that the tax which should be paid on the goods is actually paid.
However, are we doing this blind to the consequences? What jobs will actually replace those on Guernsey. I’m sure I don’t need to tell you that almost everything on Guernsey is funded by tax exploitation either directly (like many jobs in the hundreds of banks, or LVCR competition) or indirectly in servicing the people who work in those jobs – Guernsey has nothing else as a product to supply and would literally collapse without it’s unfair but unique political position.
The UK on the other hand has the advantage of being able to create jobs in other ways, manufacturing things (which shipping things on and off at such expense makes difficult in Guernsey) providing other services and much better and effective trading links elsewhere. The UK has the advantage of a much bigger land mass without the need of shipping in and out absolutely everything it needs.
I agree that this needs to be examined and the government should stop it because it damages the economy in this country and reduces the chances of a fair market in this country, but are we going to evacuate the people who live there like St Kilda, because I’m not sure there would be much left to do for Guernsey people without tax exploitation.
[…] a fascinating comment on this blog this morning from someone from Guernsey called Doug. It’s thoughtful and considered […]
@Doug Doug I think you have the Richards confused. I didn’t put this post on the blog. In any case it’s a quote from the Guardian. As for my moral position here it is : I lost my business because of tax abuse. 40 Jobs in Guernsey ? …how about the 10 people who worked for me and the thousands who worked in UK Music retail now gone. I can tell you one of my ex employees rang me up livid having read the Guardian article about 7day Shop and their ’40 jobs’ in Guernsey. I didn’t abuse any taxes neither did my employees. My business was built entirely on hard work. It was undermined by a filthy little VAT scam. Do I care about anyone that is living off the scam ? Frankly, No. I’m too busy looking after my own family, but at least I have a clean conscience.
Sorry for the confusion, I take the point, but I disagree with the idea that ordinary working people should pay for the dishonesty of a small minority who orchestrate these things.
Totally agree. I spoke to a Guernsey Politician once who was totally opposed to the investment in this offshore fulfilment industry as he said it would inevitably end with the loss of local jobs. He said that investment should be made in proper local business that wasn’t reliant on tax loopholes. Very sensible.