This comes from the government's analysis of its Brexit deal, leaked this morning to Guido Fawkes (quite deliberately, I am sure):
There will be much celebrating in the UK's tax havens, and in the City of London at this news.
I cannot possibly count the hours I spent helping ensure that the UK's Crown Dependencies of Jersey, Guernsey and the Isle of Man, in particular, complied with the EU Code of Conduct on Business Taxation between about 2004 and 2010. And I won, to be candid. Their tax laws were radically changed as a result of the campaigns I worked on then. Their planned ways to avoid the obligations of this Code were defeated, in a word.
And now the Code will no longer apply. And so they can reimpose the artificial ring fences that favour non-resident taxpayers and so recreate full tax haven status again.
Will the new deal the UK has proposed be good enough? I very much doubt it.
This is not a Christmas present that I wanted.
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Quite, Richard. Cross reference your comments here with the post I’ve just made re Johnson’s future on your other thread.
IMHO… This was all that brexit was ever about. Avoiding the long arm of EU’s pay yer taxes laws (obviously as implimented by individual states). Example, Lawson wanting French residency, then discovering what he’d have to declare and then booking the earliest EasyJet out of Dodge.
Quite, Neil.
As far as company tax evasion is concerned this takes us back to Jack Welch’s (former CEO of the General Electric Company) Barge Economics and reflects the big flaw in Neoliberalism capitalism, the lack of accountability as production is moved around the world regardless of the effect on demand. Sooner rather than latter there’ll have to be global agreement on how to best counter this just as there’ll need to be understanding that Private Interest Currency Creation has to be reconciled with Public Interest Currency Creation.
OECD-led negotiations on taxation of digitalised economy that addresses issues such as presence, profit allocation and minimum tax rates under way at the moment, with a deadline for agreement of June 2021, six months later than scheduled, and even that’s ambitious
Here’s the web link to the government’s assessment of how the Brexit Deal will pan out in terms of pluses and minuses for the UK, a pinch of salt obviously being required:-
https://www.scribd.com/document/489048219/Government-Analysis-of-the-Deal-Document#download&from_embed
A tonne, I think
No deal yet? (13.05). Achilles and the tortoise.
I can see John Redwood and Jacob Rees-Mogg will gain from this agreement,
I don’t see many gains for the the Daniel Blakes ( I, Daniel Blake film by Ken Loach ) of the North East or anywhere else.
BREXIT
The rich man’s coup.
How terribly ordinary people have been used in this country. That fact alone is disgusting.
And to add insult to injury, now the EU has perhaps biggest and most flagrant financial and trade rogue state right on its doorstep.
It does not bode well.
What are you going to do about that eh ‘Sir’ Keir? I’m all ears.
What is to stop the EU putting them ALL on their Tax Haven Blacklist?
It’s a toothless list I am afraid
Parliament is rushing to ratify a 2000 page deal within a very short time before January 1st.
The detail of the deal has not been seen, only the slogans have and the Brexiters and their media seem excited about it because they are thinking they fulfilled their dream and Brexit is done.
Only once businesses are forced to follow its strictures and courts interpret its meaning, when it comes into force on 1 January, will the deal start to have an impact.
And only then can we truly know how good a deal it is.
How great is it? Not much better than No Deal for most of us.
https://ec.europa.eu/info/files/eu-uk-trade-and-cooperation-agreement-new-relationship-big-changes-overview-consequences-and-benefits_en
https://ec.europa.eu/commission/presscorner/detail/en/ip_20_2531
“It is now for the European Parliament and the Council to have their say on this agreement.”
–––
ANYWAY – here’s a tonic and a task for this week. Merry Xmas folks.
https://youtu.be/_kkOHtniTts
And a write up on it
https://louderthanwar.com/watch-this-stewart-lee-and-asian-dub-foundation-exclusive-interview/
A worthy retort especially if it makes No1.
Those EU documents show a) we lost b) Johnson lied this afternoon – repeatedly
Johnson lied?
In other words: He carried-on as normal.
It would be much more memorable if he had told the truth.
And to continue my “There is a NewsThump for everything”:
“Boris Johnson successfully delivers Brexit deal that disappoints absolutely everyone”
“All in all, I think my team and I have done a sterling job of pissing off just about every single stakeholder group involved in the whole mess”
https://newsthump.com/2020/12/24/boris-johnson-successfully-delivers-brexit-deal-that-disappoints-absolutely-everyone/
Oh well…how about the Cayman Islands?
The same
Even the obedient BBC can’t believe it.
BBC News – What Boris Johnson’s mistake tells us about our future
https://www.bbc.co.uk/news/business-55442982
“But his manifest error in declaring there are “no non-tariff barriers” for trade with the EU had business leaders falling off their chairs. “
Exactly, at first glance the loss of service access seems crazy considering there are few upsides to the deal. Tariff and quota free access for a country that mainly imports goods could have been achieved under WTO, fishing is a fraction of the picture. We lost access to the EU service market, but of course any entity that wishes will be welcome to clean their money here. The EU could do something about its members doing such things, if it wanted to, but it won’t.
I suspect it might
Even before this … the Isle of Man contrived to circumvent both the law and common decency when for years thousand of pensioners lost their life savings in dodgy investment funds – some of the “managed” by ex-senior emplyeees of the island’s financial regulator!
Not a nice place by any stretch of anyones imagination – as those who visited Richard’s blog over 10 years ago will be aware …
Greetings old friend
Happy Christmas
[…] threw together a quick post on tax havens and the Brexit deal on Christmas Eve, noting that the UK's tax havens were likely to like […]
I think it was only a symbolic ‘win’ for Boris, because (i) the EU Code is essentially the same as the OECD principles on Harmful Tax Practices, and (ii) neither have been particularly effective at stopping tax competition. The EU Code needed the backstop of the legal powers on State Aids, and these are now part of the Subsidies provisions in the Level PLaying Field provisions of the Agreement. Much more effective than these Codes would be a global minimum tax, now being negotiated as Pillar Two of the BEPS project. Although the OECD’s proposed blueprint for this is faulty, an alternative has been put forward by the BEPS Monitoring Group for a formulaic minimum effective tax rate (METR), in its submission to the OECD, see https://www.bepsmonitoringgroup.org/news/2020/12/15/submission-on-the-pillar-one-and-pillar-two-blueprints .
Thanks Sol
But in the case of UK territories the Code was very effective indeed.