IoM Privy Council Rules On Disclosure Of Tax Documents

by Robin Pilgrim, LawAndTax-News.com, London

18 July 2003

In a judgement passed on July 7, the Judicial Committee of the Manx Privy Council announced that the statutory rule protecting the confidentiality of taxpayer records can be bypassed by the Assessor of Income Tax where 'required or authorised by any enactment or by order of a court in the island'.

The dispute began over an application for tax relief sought by the Mount Murray Country Club Ltd, Mount Murray Homes Ltd, and Conrad Hotels Ltd for the construction of a development which the firms claimed was being built for touristic purposes.

When it later transpired that the development was in fact mainly residential in nature, details of the companies' tax affairs were disclosed by the Assessor of Income Tax to a commission of inquiry appointed by Tynwald to investigate the matter.

The firms reportedly then sought an interlocutory injunction against the use of the information, arguing that it was protected under law by public interest immunity, and that further disclosure would violate their confidentiality rights under section 106 of the 1970 Income Tax Act.

However, ruling earlier this month, the Privy Council Judiciary Committee argued that section 106 (2)(i) provided for the possibility of disclosure in the aforementioned circumstances.

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