They have long memories on the Isle of Man. As the Isle of Man Today website (which is the main news outlet for the island) notes this morning:
It was Richard Murphy of the Tax Justice Network who claimed credit for raids on a revenue sharing deal between the island and the UK in 2009 and 2011.
The issue meant the island's public finances were sent reeling from the loss of more than £200m in VAT revenue - a third of government income - after the UK revised the Customs revenue sharing arrangement in 2009 and 2011.
Since then, however, it has started to rise again and in 2016 there was the introduction of FERSA (Final Expenditure Revenue Sharing Arrangement) .
The story is about the Tax Justice Network Financial Secrecy Index. They have not noticed that I have not run this since 2009. But, I don't think they want that to spoil their story.
Because it is entirely true that I did single-handedly expose the way in which the Isle of Man did until about 2010 abuse a VAT subsidy from the UK to claim more than one-third of its government income from the British government meaning that, as a result, the UK subsidised it to be a tax haven. This was then taken away, and I was given credit for that fact. The full story is here.
I guess no abuser likes being exposed.
And it is certainly true that no tax haven has ever liked facing the fact that it lives off revenues transferred from other jurisdictions to which they should rightfully belong.
But what is really surprising about this story is that the Isle of Man shows no contrition for having acted in this way, of which they must have been aware, for so long. Instead they want to blame me for exposing them.
For the record, I am happy to take the blame for what I did. I did not close the Isle of Man tax haven. But I exposed what it was doing and how it worked. And it so happened that cost them a third of their government revenue. So be it. I have nothing to apologise for. They still have.
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Four legs good. Three legs bad. 🙂
Agreed
You could claim this is old news since the Duke of Atholl was supposedly paid off with £70,000 plus a pension of £2,000 p.a. in 1765 by the British Treasury to give up his fiscal rights in the Isle of Man. This was an attempt to stop the ancient smuggling trade and English customs officers were installed to police the new deal. Inevitably the attempt failed and the smuggling continued. In 1806 he came back for another payment which even Lord Chief Justice Ellenborough described as “one of the most corrupt jobs ever witnessed in Parliament.”
Yet in 1826 the latest Duke was paid a further £417,000 to give up any remaining privileges and so it goes on.
Meanwhile of course there was no such individual to pay off in the Channel Islands and the trade has carried on there without much interruption since the Duke of Normandy broke with France in 1204….
🙂
Careful there, the Duke of Atholl is still the only person in the UK allowed to keep a private army (G4 and Serco are jealous as all hell of course).
Peter says:
“Careful there, the Duke of Atholl is still the only person in the UK allowed to keep a private army…”
Used to apply to the Bishop of Durham too, or so I was told….but maybe that’s no longer the case….(?)
I don’t think so
And I think that it was the Percy’s anyway
Well done you…
This is why the Royal family and titles should all be confined to history.
and have no place in the modern world.
I don’t entirely agree with Richard on this one. I was born in the Isle of Man where we had a farm, but I have not lived there since 1974. Be that as it may, when it comes the Common Purse on VAT and Customs Revenues (and Richard should note that it is not just VAT, but Excise Duties and Customs Duties as well) then it is the UK that collects and holds the money and essentially the UK Treasury that decides what share the Isle of Man should get. Obviously the Isle of Man can ask for as much as they like, but there is nothing that says the UK has to take any notice of that. It is not as if the IOM has any power over the Treasury that could force it to cough up. So if the formula is wrong and the IOM is getting too big a share then surely the blame for that lies firmly at the doors of the UK Treasury. You can’t expect the IOM to say ‘Sorry, you are giving us too much – have some of it back’.
It is also worth pointing out that the IOM is also charged by the UK for the provision of Defence and Foreign Affairs services each year (in the tens of millions I think, though I have not looked it up). Also any Manx student attending a UK University is charged the full Overseas fee (so at least double the home fee) which the IOM Government pays to the Treasury on behalf of the student. Unlike a normal overseas student fee the money is not paid to the university but is retained by the Treasury.
Have you ever spent any time in the Island? Bleak is not a word I would use – a lot of it has a very lush West Coast Temperate Rainforest climate and as a result a lot of plants from the Med etc do very well – e.g. the Canary Island palm trees. Plus the steam railway, electric railways and the horse trams should be right up your street.
Personally I think the Isle of Man should opt for full independence and terminate all shared arrangements with the UK such as the Common Purse.
To add to the story about the Duke of Atholl and all the money he got for selling the Island back to the Crown, then the UK after 1826 set about making the Manx people pay off the debt plus interest on it which caused such discontent that it led to the restoration of Home Rule in 1865.
Sorry Tim – whilst you can blame the UK the IoM knew that the agreement (that dates from 1911) was not reviewed for decades and that they were coining it and they said nothing
I know exactly where the blame lay here
Westminster may not have been on the ball, but the Iself of Man knew that and abused it
Well I would still mostly blame Westminster. You are ignoring human nature – if HMRC sent me a tax refund I would be very unlikely to send it back saying it was a mistake. I am sure you are probably right that the IoM Government knew they were getting too much, but why would they rock the boat? You have said in many posts that Westminster is pretty hopeless at looking after our Public Funds and I think this is just another example. If they were incorrectly paying out hundreds of millions of pounds a year on the basis of a 1911 Agreement they had never looked at since then I rest my case. Incompetence in the Treasury.
Sorry Tim, but that is a typically IoM comment and I am disappointed that you say it
I’m with Tim on this one – I would not want to be on a side which seeks to diminish the role of H M Treasury or fails to acknowledge and condemn their incompetence.
I have never said the Treasury were right
I discussed culpability based on awareness
“if HMRC sent me a tax refund I would be very unlikely to send it back saying it was a mistake”
So would 99.5% of the population..those who claim otherwise are probably lying
No they’re not
I have seen it
And advised it to be necessary