Impact Of Information Exchange On IoM 'Hard To Assess'

by Amanda Banks, Tax-News.com, London

09 July 2002

In its recently published annual report, the Manx standing committee on economic initiatives admitted that the economic impact of information exchange agreements on the Isle of Man's finance centre is difficult to assess.

However, according to an Isle of Man Online report, the committee believes that any problems which arise as a result of the jurisdiction's commitments to exchange tax information with other countries will be 'essentially transitional', and that Manx businesses will adapt to them in time.

'The proposals emanating from the EU should not be too seriously disadvantageous to the Island. There could be an initial negative impact on the banking sector for automatic exchange, but the inevitability of some exchange along these lines is to some degree becoming accepted,' the standing committee report noted.

According to the IoM Online, the committee advised, however, that the Island's authorities should push for reciprocal benefit in any negotiations:

'Ideally, a quid pro quo arrangement would include: recognition of the level playing field principle, unimpeded access to financial markets and equal treatment with EU states, and the establishment of double taxation agreements,' the news service suggested.

The committee report also raised the possibility of EU membership for the Island, arguing that although the UK government has promised to represent the Isle of Man in negotiations with the European Union, its desire to protect the City of London will likely cloud its judgement to a certain extent.

Just remember, Tynwald, that he who sups with the devil needs a long spoon.

Recommended