IoM Announces Plans For Detailed Economic Review

by Amanda Banks, Tax-News.com, London

21 August 2002

Writing in the Isle of Man Online this week, Manx Treasury Minister, Allan Bell announced that a detailed review of the Isle of Man's economy will be taking place soon, leading to the publication of a draft report early next year.

Although he expressed optimism for the future, Mr Bell stressed that the Manx economy is not immune to change, citing cheap labour competition from countries such as India, and increased scrutiny from external bodies such as the EU and the OECD as examples of this.

'The Island today is very much part of the world economy and the world is changing. Globalisation is exposing us to increased competitive and political pressures,' he wrote, although he noted that on the positive side, scrutiny from multilateral organisations has allowed the Isle of Man to prove that it is a well regulated and stable jurisdiction.

'However, changing international standards on taxation will make it harder to attract new business by traditional methods, and the downturn in the world economy will compound this difficulty.'

'To succeed in this more competitive environment the Island needs to adopt a more dynamic, focused, and creative strategy. Along with our specialist skills, technical infrastructure and government support, low tax is an essential part of the package to attract new business growth,' Mr Bell observed, adding that: 'As the Isle of Man has substantial VAT receipts, we can be more creative with our direct tax levels.'

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