Isle of Man forced to increase taxes and reduce spending
In a move prompted by the UK government's claw back of £140 million in annual tax receipts, the Isle of Man authorities have confirmed the introduction of higher taxes and reduced public sector spending. Government spending on the island will fall by £49 million a year, almost 10% of the annual budget, by 2015 and the rate of income tax will increase from 18% to 20%.
Last year we saw the UK government clawback a larger proportion of annual tax receipts from the offshore haven with the so called "common purse" set to fall by £85 million in the 2010/11 tax year and £140 million a year into the future. There has been, and continues to be, a very close relationship between the UK government and the Isle of Man authorities but the UK government's attack on various tax havens around the world has taken in the Isle of Man as well.
This is an area of the world which has recorded unbroken economic growth for 26 years although for the first time in living history there is some uncertainty about the island's short to medium term prospects. The authorities on the island have already confirmed they will use up various cash reserves, built up over the years, to smooth the reduction in public sector spending although job cuts in this area have not been ruled out.
Share this..
Related stories
Budget 2010: Check out UK government spending plans for 2010/11
The UK government's £704 billion budget for 2010/11 will be spread amongst many different areas of the UK economy but there are some striking issues which will need to be addressed in the short to medium term. So where exactly will your money be spent? By far and away the largest expenditure will be on Social Security which is expected to cost £196 billion, health is not far behind on £122 b...
Read MoreBudget deficit lower than expected in May
The UK budget deficit was significantly lower than expected in the month of May with a figure coming at just under £12 billion as opposed to a forecast of £20.25 billion. However the government's preferred measurements of the public sector borrowing requirement, on an accrual basis, came in at just over £16 billion as oppose to forecast of £18 billion. Either way, the health of the UK budget d...
Read MoreNew council tax band hikes for 465,000 homes
A local government review published yesterday proposed the introduction of two new bands of council tax, G2 and H, which would mainly affect more expensive properties in London and southern England.The review advised that properties worth more than £545,000 would in future fall into band G2, and would face an annual tax of £2,500 - affecting about 460,000 homes in total.The proposed H band would...
Read MoreIs a tax on chocolate really helpful?
This week we saw a Lanarkshire GP call for the UK government to consider imposing a tax on chocolate as a way to ease the ever worsening obesity situation in the UK. While this suggestion was treated with the contempt it probably deserved on the face of it, under the surface there are serious concerns about the obesity problem hitting the UK and the cost to the National Health Service. But is a ch...
Read MoreHome Information Packs - A Tax On Home Sales?
The National Association of Estate Agents has called on the government to instigate a thorough review of the Home Information Pack (HIPs) system amid claims that it is not fit for purpose. It was common knowledge prior to the launch that some mortgage lenders would still ask for their own surveys leading to claims that HIPs are just a tax on home sales.
However, the chances of the...