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Applebys: Something or other about planes and VAT. CM says Panic!

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2 hours ago, Max Power said:

I think it's more likely that HMRC have found that IOMG have done nothing wrong and don't want it trumpeted until they can change the law? Brexit is probably delaying things?

Is the correct answer!

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16 hours ago, Uhtred said:

Is the correct answer!

When these things have been looked at before -  the UK was found to have been just as bad or worse than the so called tax havens, maybe what it found implicates the UK more so than the island.

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On 9/15/2019 at 1:15 PM, Max Power said:

I think it's more likely that HMRC have found that IOMG have done nothing wrong and don't want it trumpeted until they can change the law? Brexit is probably delaying things?

As I said in July I suspect it's more likely that HMRC discovered that what was going on was illegal in some way but that the UK and HMRC were so strongly implicated themselves that they want to keep things quiet.  Alternatively it may be so complicated legally to sort out, requiring extensive litigation and legislation, that it's been shelved because of Brexit.  If it was all simple and correct, we'd have heard fairly soon after.

23 hours ago, foxdaleliberationfront said:

FOI time perhaps 

Someone did in July (see previous page) and it was confirmed nothing had been received.

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4 hours ago, Roger Mexico said:

As I said in July I suspect it's more likely that HMRC discovered that what was going on was illegal in some way but that the UK and HMRC were so strongly implicated themselves that they want to keep things quiet.  Alternatively it may be so complicated legally to sort out, requiring extensive litigation and legislation, that it's been shelved because of Brexit.  If it was all simple and correct, we'd have heard fairly soon after.

If only there was some sort of razor we could use to slice away that complexity...

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On 9/15/2019 at 1:15 PM, Max Power said:

I think it's more likely that HMRC have found that IOMG have done nothing wrong and don't want it trumpeted until they can change the law? Brexit is probably delaying things?

Well done Max :)

Interesting timing releasing that when Brexit fever reaches crescendo ...

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31 minutes ago, b4mbi said:

Well done Max :)

Indeed.

So it only took them a year to confirm that the law was being applied just as it was required to be. What is perhaps surprising though is that (so far as I am aware), the EU has not since changed the law. That seems to suggest it's also the way they want to continue its application.

 

[Edit] Actually it's now roughly two years since the original allegations came out. 

[Edit] UK Treasury link: https://www.gov.uk/government/news/treasury-publishes-isle-of-man-vat-review

[Edit] Full report: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/839880/HMT_review_of_Isle_of_Man_s_VAT_procedures_web.pdf

 

Edited by Yibble

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38 minutes ago, Dave Hedgehog said:

Where else is the money coming from to pay for all the capex projects in the pipeline?

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Anyway, we can now await reasonabe and balanced apologies from the likes of Panorama, the Grauniad, Bell-end Murphy and others of that ilk. I am sure they will be quick to point out how they had misrepresented the IoM's role here, and go on to praise the IoM for ensuring the law was correctly applied.  Ha, ha,

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On 12/6/2017 at 7:44 PM, P.K. said:

Oh FFS! And once again I will give you exactly the same answer:

You can bang on and on until you are (hopefully) blue in the face about no actual laws have been broken but the reality is it is up to HMRC and the EU to make that call.

They have yet to make it.

But to pretend it's anything other than avoiding paying your way is simply childish.

Tell you what, why not waste more of your time and bandwidth banging on and on about this nonsense while the adults wait and see what transpires. That way, until that decision comes, we can simply ignore you.....

The decision is in - what do the 'adults' now think?

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5 minutes ago, Yibble said:

Anyway, we can now await reasonabe and balanced apologies from the likes of Panorama, the Grauniad, Bell-end Murphy and others of that ilk. I am sure they will be quick to point out how they had misrepresented the IoM's role here, and go on to praise the IoM for ensuring the law was correctly applied.  Ha, ha,

 

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Meanwhile Lewis Hamilton has sold his private jet and opened a vegan restaurant in London.

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Presumably the UK and IoM can also expect a formal apology from the EU Commissioner for Economic and Financial Affairs, Taxation and Customs Union, given his Commission appears to have reached an incorrect conclusion on the UK's oversight of the issue, improperly implied that the IoM was involved in abusive practices and then (the EU) been incompetent in their own arrangements for review.

https://europa.eu/rapid/press-release_IP-18-6265_en.htm

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I suspect if we dig down into this it's not going to quite as clear as everyone is claiming.  If you look at the statement that has been issued, things aren't completely perfect:

Quote

In a statement, the Financial Secretary to the Treasury, Jesse Norman said:

"This is a matter of considerable public importance, and the Isle of Man government rightly agreed to a full review.

I am pleased to confirm that the reviewers have found no evidence of widespread VAT avoidance. However, the Isle of Man government is taking action to improve its post-registration checks as a result of the review. My officials look forward to working closely with them to provide advice and guidance throughout the implementation and in the future."

Note that it's the IOMG that 'agreed' to the review not requested it (though the accompanying letter says differently.

But the 'post-registration checks' were where there was always the problem that we knew about.  Companies and individuals were getting the VAT back and then not using the planes for business purposes.  The Island was supposed to have made sure that this wasn't happening (and charge VAT if it was) and clearly they were't doing those checks.

The cover letter to Quayle makes this clear:

Quote

[...] implementing robust and effective post registration assurance procedures will help strengthen public trust in the Isle of Man VAT system and this is paramount to ensuring that our close relationship on VAT continues.

(my bold).  So stripping away the civilservantese politeness, they are being told to do things properly in future.  Or else.  This is emphasised in the actual report:

Quote

Key finding: IOMCE has not carried out extensive, systematic and routine post registration compliance activities. HM Treasury notes that this activity is resource intensive and could be difficult for many small jurisdictions but considers that additional post-registration compliance activities would provide further assurance over the correct VAT treatment of the aircraft or yacht after registration. HM Treasury notes that this does not necessarily mean that there has been an incorrect application of VAT rules of aircraft or yachts. Indeed, the information provided to HM Treasury from HMRC’s work on specific taxpayer cases has thus far not identified any past case of non-compliance. However, more robust post-registration procedures would provide IOMCE and the wider public with further assurance that VAT was administered effectively.

There's no real explanation of the long delay.  They are keep to stress the complexity of the regulations, though in part it may be due to the amount of investigation that was done:

Quote

HMRC has reviewed over 300 corporate groups and individuals from its customer population who were identified in the documents. For approximately 80% of these, the structures identified have no UK tax consequences or were already known to HMRC.

For the remaining 20%, where new information is available, these are subject to ongoing examination by HMRC, who will take robust compliance action wherever appropriate.

That suggests that they looked at pretty much all the cases involved.

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