Jersey and Guernsey authorities are not happy about the fact that they have been included on a ‘tax haven’ list, which is being used by the United States Senate. The islands are concerned for their reputation as the list also includes other jurisdictions such as the British Virgin Islands and the Isle of Man.
The United States Senate is considering the list as they look at ways in which to combat the problem of United States taxpayers avoiding tax, by making offshore investments. The list has been complied from data obtained in 2001 and Jersey and Guernsey are claiming that the information cannot be relied upon, as it is too old. Government delegations from Jersey and Guernsey will be visiting the United States to put their case forward and hopefully remove their names from the list.
Our view
Territories such as those mentioned have used offshore tax planning as a major source of business income for many years. Whilst their tax treatment may not be as favourable as some Caribbean or jurisdictions they still have tax beneficial options for non-residents. Both are also blacklisted as ‘tax havens’ under Spanish law, so we are not sure why they are upset. Do they offshore tax efficient opportunities for non-residents or not? Of course they do.
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