Isle of man investors and business leaders were warned that they should have concerns about their future as an offshore finance centre by a leading economist.
They heard the recession was an opening giving governments the opportunity to bring in tougher financial regulation under the excuse of preventing a future recession by allowing an unregulated world economy.
The speaker was Roger Bootle, economic adviser to Deloitte, a specialist adviser to the House of Commons Treasury Committee and an Honorary Fellow of the Institute of Actuaries.
Financial regulation threatens offshore centres
‘There are moves towards a re-regulation of the financial sector which I suspect will go too far,” he said.
‘The French and Germans are particularly concerned about this regulation of the financial sector and will push the Isle of Man and other offshore financial centres to be brought within some sort of net.
‘’I would be concerned and prepare for the worst and make representations very, very strongly.”
Bootle did offer some hope for the island’s economy by adding that the he ‘guessed the Isle of Man would have a pretty good case’ in showing the international economic community that it was a well regulated financial centre.
“But if I were advising the Isle of Man Government I would be suggesting there was a severe danger, probably greater now than there’s been at any time in the last 20 or 30 years,” he said.
Global corporation tax rate under discussion
Other offshore financial centres further away from Europe – like the Cayman Islands – have experienced severe economic problems as OECD governments have clamped down on banks and financial companies they claim are aiding tax evasion.
Several OECD countries have also put forward the suggestion of a global corporation tax rate that would particularly affect the Isle of Man, which has a zero rate tax for companies.
The action follows governments investing in the banks to stop them failing, which has given unprecedented access to the banking system as many countries now have taxpayer representatives sitting on their boards of directors.
