Isle Of Man Cautiously Welcomes Savings Tax Agreement Terms

by Amanda Banks, Tax-News.com, London

03 February 2003

Speaking recently with regard to the likely impact of the EU savings tax agreement on the Isle of Man's finance centre, Manx Treasury Minister, Allan Bell was cautiously optimistic, recognising that the current agreement allows the UK's offshore territories and other low tax jurisdictions a greater degree of flexibility than might otherwise have been the case.

Speaking to Tynwald, Mr Bell announced that:

'We are looking at the detail of the agreement reached and seeking clarification on a number of points. Our initial view is that the outcome appears to be fully in keeping with the constructive response that the Island has sought to adopt to this developing international initiative.'

He added: 'It is clear from the agreement that the Island will not be treated any differently than Switzerland or other third countries and the EU member states of Luxembourg, Austria, and Belgium.'

The Treasury Minister explained that the Manx authorities were uncomfortable being dragged into an EU issue, but resigned to the fact that the jurisdiction's participation in this international initiative is mandatory:

'The whole exercise is not based on fairness, or common sense, or logic. In many ways it is quite an irrational political process which we have ended up with and, perhaps, from our point of view it is not the best way of going about things but we have to live in the real world.'

He concluded: 'It is not a negative at this stage. We see there is more flexibility in what we have ended up with and [it] may well actually give us new opportunities and greater advantages than we might have expected earlier on.'

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