Blacklist is of more concern than tax tales
AS A BROADSIDE of stories about tax avoidance is fired from media outlets across the world the island’s natural response is to duck.
Nothing to see here, we are a well-regulated offshore finance centre, not a grubby tax haven. Move along please.
And so far the island’s only connection to articles about the tax affairs of the Queen, Bono and Trump’s advisers is that Appleby, the firm from whom the documents were taken, has an office here.
So far so good.
Except the collateral damage of a worldwide political and media storm of this nature is widespread. The nuanced differences between tax avoidance and evasion are lost as surely as is the difference between a Crown Dependency and an Overseas Territory.
As TV presenters skip in one breath from Jersey and Guernsey to Panama and the British Virgin Islands in their map of ‘tax havens’ the hope that this Bailiwick can escape with its reputation unsullied seems increasingly forlorn.
In that light whether one or more of the stories gleaned from the millions of documents hacked from Appleby and other firms’ computers directly implicates these shores becomes increasingly irrelevant.
More important is how the world perceives the Channel Islands and what it is willing and able to do about legal tax avoidance.
In the immediate future that includes the EU with its blacklist of worldwide tax havens.
When Europe’s finance ministers sit down today one would hope that the island’s strict adherence to international finance standards will carry some weight. Unfortunately, the EU has history in this area and politics often play as much part as common sense.
For that reason it is not clear whether the adoption in August of a central register of the beneficial owners of companies will be in the island’s favour or not. Yes, it is a private register, which will irritate the tax campaigners, but it is a step beyond where many similar jurisdictions have gone and it is available to law enforcement bodies in search of crime.
Despite the furore, long term it is the decision on blacklists that has the potential to do far more damage to this economy than stories of how the rich move their money.