I can’t wait until the next elections so that I can outline what finance has cost Islanders
Wednesday 24th November 2010, 3:00PM GMT.
From Ted Vibert, president, Jersey Democratic Alliance.
YOUR readers have become used to the illogical tirades by angry banker John Boothman. It is understandable that he, figuratively speaking, foams at the mouth at the slightest criticism of the finance industry.
His comments about Richard Murphy and John Christensen are insulting and patronising towards two hardworking, honest and fearless campaigners against tax havens located around the world.
To suggest that the sole aim of the UK-based Tax Justice Network is to damage Jersey’s finance industry is silly. Their organisation is dedicated to informing governments around the world of the damage that all tax havens do to various countries and the ability of those countries to collect tax revenues from their citizens who wish to avoid paying their contribution.
Mr Boothman states that the TJN is waging an assault on zero-ten as part of a campaign which, if successful, will see the Jersey economy ‘laid to waste’.
It is very clear that the Jersey finance industry is now looking to shift blame for the failure of zero-ten to be approved by the EU on to other people. The JDA opposed the zero-ten tax regime from the very outset, claiming that it was unfair that Jersey-owned companies had to pay tax at 20 per cent on their profits whereas foreign owned companies pay no tax at all.
These companies include Normans, Connex, de Gruchy, Kingfisher, Marks and Spencer, the Jersey Evening Post, British Home Stores, the Grand Hotel, Hotel l’Horizon and most King Street companies with UK bases – which means nearly all King Street businesses.
It is not the JDA or the TJN that is going to put an end to the zero-ten tax regime, but the EU Code of Conduct for Business Taxation. The States members responsible for its introduction, which included Senators Le Sueur and Ozouf, are the people to blame for it. And Mr Boothman, with his close links to these people – along with other people in the Small Society – who should have known better, must also shoulder the blame for failing to stop the States going ahead with it.
How any of these so-called financiers could have believed that such a scheme, so blatantly in breach of the Code of Conduct, would ever stand up to critical examination is beyond my comprehension.
It is clear that Mr Boothman is sending out a message to the Island that the JDA is opposed to the Jersey finance industry. That is simply untrue. I have always stated that I am not proud to live in a tax haven, but I appreciate that it is now our economic lifeblood and there is no way we can turn the clock back.
However, the JDA, although recognising that tourism will never return to its heyday, believes that our politicians were seduced by the easy gains of the finance industry and failed to invest in tourism or agriculture. Much more could have been done to develop these industries but it would have required financial investment.
All we ask is that the finance industry stand on its own two feet, finances its own promotion and complies with acceptable business practices (and great strides have been made in this area). Our opposition is to the ten per cent tax subsidy the industry now gets which Jersey simply cannot afford. Many people are going to suffer because of it, including the young, the sick and the elderly.
Finally, I see that Mr Boothman lays down a challenge for the elections next October. I hope he will be a candidate. Nothing would give me greater pleasure than meeting him on the debating platform where he can tell the people of Jersey about the benefits of the Jersey finance industry and I can outline what the industry has cost ordinary Islanders.
I can’t wait.
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Far more reasoned argument Mr Vibert than some of the rantings of others!
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I am still waiting for Mr.Boothman to explain why £255B/year wouldn’t make any difference to poverty around the world.
Taxhavens/finance centres are there to cut down on tax and to protect the wealth of those participating in these practices, pure and simple. The rich love them as they save themselves a fortune in taxes.
No one is isolated from society and we are all interdependent. As part of being a society everyone should pay their dues and not what they can get away with.
The government, has made select groups very rich snd widened the gap between the rich and the poor due to their fiscal policies they have followed.
The government is now putting most of the tax burden onto those less able to afford it and may well make this burden even worse in the race to the bottom to appease finance.
The government has made island business outside of finance uncompetitve both locally and outside the island. This due to charging them 20%, whilst their competitors, who are giant companies in comparision, with the added advantage of economies of scale, pay 0%.
They will also be burdening these business’ with 5% GST if mr.ozouf has his way, which they have to waste time on administering for the government. No wonder local business’ are struggling.
Where will all these extra people go when local business is all but gone? In the finance industry, or on the unemployment register adding even more to the welfare burden being placed onto the tax payer?
It has also employed a lot of people in Jersey who would otherwise be doing low paid jobs like burger flipping.
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Mr Vibert I think you’ll find that regardless of its parent company the local Connex operation is a Jersey registered company.
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on one hand you call for support for declining industries of tourism and agricultuire yet on the other hand criticise and call for an end to support to the lifeblood industry of “finance”, somewhat contradictory and confusing message Mr Vibert. If you want the finance industry to stand on its own two feet then shouldnt same principle apply to other industries, whats the difference?
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If the news is to be believed the EU Code of Conduct group have only expressed an opinion on whether the ‘deemed distribution’ provision is personal or business tax in disguise. If it’s the latter then it may not be compliant. Why doesn’t everybody wait until Ecofin delivers it’s verdict before trying to interpret a near silence?
I agree with ‘confused’ above the JDA want to stop subsidising one part of our economy (the healthy bit) to subsidise the tourism and agriculture which have had their day. Not only is this inconsistent, it would be extremely risky.
Craig no.4 regarding zero tax on non-Jersey business, local registration is not the issue, its where the company is owned. I would be surprised if any of Connex is owned in Jersey but would be happy to be proved wrong.
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I would love to know what the alternate corporate tax model is from the JDA rather than read all this ‘he says, she says’ moaning all the time. Because the way Ted Vibert goes on you’d think the finance industry to him was some kind of disease.
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#8 I stand corrected.
Connex Jersey’s website says that the company is owned is by Veoilia Transport which appears to be a French company. Is the identity of the Jersey shareholders of Connex Jersey in the public domain?
Of course if it is wholly owned by the French parent then under zero ten it would pay zero corporation tax, wouldn’t it?
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No 8.
Where the company is registered is irrelevent.
Generally, if a trading company is locally-owned, tax will be based on deemed distributions, if foreign-owned, no tax will be payable.
I thought that connex was foreign-owned so can you explain on what basis corporation tax was payable?
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The Company Connex Jersey Ltd was set up in July 2002 as a Jersey Company, yes it is owned by Veolia like the new Incinerator at La Collette all the accounts for Connex Jersey are in the Public Domain and you can apply to see them just like any other Jersey Company. You will be suprised of how much Business Tax that they have payed over the years also the list of Directors are also shown as well.
Hope that clarifys everything.
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No 11.
You have not answered my question, If the company is foreign owned there will be no deemed distributions and no tax will be payable. Can you please explain why, since the implementation of 0/10, on what basis the company is paying corporation tax? Is Veolia a Jersey Company?
(incidently Jersey companies are NOT required to file accounts, and accounts are not publically available for Jersey companies so I do not understand your ‘just like any other Jersey Company’ comment)
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I’m amazed that the JEP can publish these deceptions promoted by Mr Vibert.
He is either completely inept, a liar, plain stupid, or unwittingly miss informed – you decide !
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Bob (13)
It’s a trick question of course! The answer is : all of the above!
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All this time it has been assumed that Jersey was forced to change its tax regime by the EU. Now we are told by the JDA that Zero – 10 was dreamt up by the CoM, Guernsey and the Isle of Man as an excuse to introduce GST. As for Finance paying its own way it has just been assumed that of our three principle industries finance accounted for over 80% of our tax take– directly or indirectly through employees income tax yet accounts for less than half the workers which sounds to me like it pays far more than its own way.
Just one question – what planet does Ted Vibert, Mr and Mrs Southern and the UNITE union come from?
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as alwys pro-finance industry people claim that I want to dismantle the finance industry. I make it very clear in my letter that I know that finance is our lifeblood now and is crucioal to jesey’s prosperity. However last year it made 948 million profit and can well affford to do its own promotion. the same can’t be said for the tourism industry, which is in a slump. Agriculture is doing better but still needs help in terms or creating new markets with new products and then promoting them
Regarding Connex it is owned by a French company and although the ex Connex accountant is probably right that they have paid local tax, the zero ten regime doesn’t come in to play until 2011 so he wouldn’t know would he.
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Blimey! What would PJG make of Ted’s fingers and eyesight(post#16)? Never mind the field day for the spelling, punctuation and grammar police (for whom I now only work in an honorary part time capacity).
One or two politicians have decided to join the fray on here, with mixed reception. To rush an unchecked (well, I assume it was rushed and unchecked) reply is a bad move as, rightly or wrongly you are going to be judged by its presentation as well as the content. It has happened to me over occasional errors, and I’m not a public figure.
Let’s just say that if that post really was from Ted Vibert it will have lost him quite a few points. I can barely believe that it came from the same writer as the original letter.
Ted, I believe that you mean well but posts like that one won’t help your image. It will stick with you like the unflattering library pictures of Geoff Southern!
While I’m at it, why do so many keep referring to ‘Blogs’ and ‘Bloggers’ in relation to this forum? Surely Weblogs (blogs) are something different? This is a ‘forum’ with ‘threads’ of ‘comments’ put there by ‘posters’. The misuse of ‘blog’ is becoming so frequent that the original term will soon need redefining.
This may well have to become a hobby horse of mine if people don’t mend their ways!
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