Positive Action Group - Possan Jantys Jarrooagh

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Home The News Latest News Tax Cap Criticism

Tax Cap Criticism

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Treasury spent £75k In 2006 and £75k in 2007 to attend Conferences in Geneva for 'High Net Worth Advisers'. In 2008 £80k was spent on 'Wealth Man Conferences'.

 

It's no surprise then that Chief Minister Bell continues to try and justify his tax cap policy, to convince us it's working.

Now Messrs Teare and Shimmin are firmly on board and DOI Minister Cretney is so convinced that he wants the planning system altered for rich immigrants to build large houses in the country.

They are all singing from the same hymn sheet.

 

The Bishop is not!

 

He was highly critical of the tax cap policy in the Budget debate and Chief Minister Bell felt he had to respond (edited)

 

"The whole purpose behind this high net worth attraction... and let me tell you it is not an Isle of Man issue. This is a fierce economic market, worldwide now, whether we like it or not, and if anyone knows my political roots, 30 years ago I would have been burning down houses trying to stop these people coming here!

So I have had a Damascene light along the way.

 

We have got to be realistic. There is no going back to pre-2008. We have got to fight for every pound of investment we can possibly get into this Island and we have got to use every mechanism possible to attract it and it may stick in the craw for some people to invite wealthy people over here...

 

These wealthy people come to the Isle of Man, they pay tax – which is not here at the moment. They build houses, which are not here at the moment. They employ people who are not being employed at the moment.

In some cases, they are bringing their businesses with them. There is certainly a great opportunity with a number of them that I have met for future investment in other opportunities on the Island.  Jersey was mentioned, that they pay less here than in Jersey – they don’t. They pay the same here as they do in Jersey. Guernsey is fighting for them. I had a senior banker on the Island only two or three weeks ago talking to me and actually saying that the Isle of Man is falling behind in this because he is seeing far more of these people moving into Jersey – an overcrowded island, as it is – than ever comes on the books in the Isle of Man. Switzerland is after it. The Caribbean is after it. Many European countries now. London is after it, for God’s sake. What do you think the non-doms are?


They are all recognising the huge benefit that these people can bring to our community, and I know you can put the moral argument that we should not be looking for this sort of business. These people have to live somewhere. Why should they not live in the Isle of Man and invest here and give us their money   –and give us their jobs at the same time? We have a duty to our people to employ them and give them a future in the Isle of Man. (Mr Crookall: Hear, hear.) That is what it is all about. It is not playing golf and drinking gin and tonic, I can assure you! (Laughter) We have got to do our best to stimulate a society here which is committed to innovation and the encouragement at every level of entrepreneurial skills and activity within the community."


Rather than give us this rhetoric Mr Bell, give us the facts. Exactly how successful has the scheme been since it was introduced 5 years ago? Facts please, facts.

 

Comments   

 
-2 #5 More information please!Guest 2012-06-24 15:26
I really hope you are right Johnr!
There wouldn't be any criticism if government opened up about this. Do you for example know a) how many 'tax-cappers' were resident here when the scheme was introduced in 2007 b) how many new 'tax-cappers' have been enticed over here as a result of the scheme c) how many new businesses have been established here by these new residents d) how many new jobs have been created as a result?
Such fundamental information is not readily forthcoming so no wonder there is criticism.
Oh yes, forgot to mention the planning system is being altered to accommodate rich people.
We are in danger of becoming a plutonomy - is that what we really want?
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+1 #4 The tax cap does workGuest 2012-06-24 12:09
You're all woefully misinformed as usual. The group set up by our chairman alone employs over 100 people and contributes over £40m to the coffers in VAT every year, as well as ITIP and NI of course. If it wasn't for the tax cap, these businesses simply wouldn't be here.
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0 #3 Easy factGuest 2012-02-27 08:41
There's one simple fact that ought to be readily available.
The Tax Cap in this 2012 Budget was raised from £115K to £120K.
That's £5K per rich person.
So how much extra tax revenue does Treasury estimate this measure will raise based on 2010-11 returns.
Divide the answer by 5 and that gives the number of rich people resident here.
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-1 #2 Info is availableGuest 2012-02-27 08:22
Tax Cap - We have the info - given in a Tynwald or Keys answer some months ago - it hasn't worked - the rise numbers qualifying since it was introduced is within statistical variation - so it was just mainly a tax reduction for those already here. It should have been promoted more off the Island - but they were probably frightened of upsetting the Brits!
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+1 #1 From Bankers to BuildersGuest 2012-02-26 09:42
Could this be Mr Bell's secret plan B? ;-) As the banking industry declines - not helped by Tynwald's continued unwillingness to back a credible depositor compensation scheme in any way comparable with those in place in the UK and elsewhere in Europe - redundant bankers will be able to find gainful employment building mansions for the horde of wealthy incomers, lured to the island by its highly regressive tax policies and who just might (or might not) bring added value to the island's economy.

The IOMG government has always seemed to want to get the benefits of deposits from off-islanders at the lowest possible cost and risk to itself. This can only be achieved by under-informing or misleading depositors about their risks. While this might have worked before 2008, it is less and less likely to do so now. The latest failure of Tynwald to bite the bullet by ring-fencing funds for the DCS (a forward-looking plan stillborn as a result of internal lobbying, to the great relief of Mr Quayle and others) is yet another sign of the unwillingness of the island's leaders to provide adequate protection for its depositors in line with best European practice. The negative signal it sends out is hardly likely to reverse the flight of funds from the island.

http://bit.ly/Ac4jsp
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