1. ITV Report

IoM Gov denies claims made by investigative journalists of aircraft VAT avoidance

Chief Minister Howard Quayle MHK held a press conference yesterday explaining how this was a "matter of national importance." Photo:

The Isle of Man Government has come under fire for allegations of VAT aircraft avoidance, made by journalists associated with the International Consortium of Investigative Journalists (ICIJ).

Yesterday Chief Minister Howard Quayle MHK held a press conference with local media about the matter, with the subject not revealed until the meeting was underway.

Organisations such as The Guardian, the BBC, leading German media and Japanese TV have all been ICIJ bodies inquiring about VAT regulation since February.

He said he was due to be interviewed today for the BBC's Panorama and that Government has invited HM Treasury to conduct an assessment of the practice for the importation of business jets into the EU, with a focus on the VAT treatment of aircraft leasing arrangements.

The VAT treatment of the importation of aircraft into the EU is a highly technical and complex area in which the Isle of Man follows the same policy, laws and rules as the United Kingdom. The Isle of Man Government works closely with HMRC and holds quarterly governance meetings on a range of VAT issues. In light of the claims made by the ICIJ, we have asked HM Treasury to look at all elements involved in the process of the importation of business jets via the Isle of Man into the EU.

– Chief Minister Howard Quayle MHK

The scope of the assessment will be defined and published in November, with the work estimated to be completed in 2018.

Since 2011 corporate jets over 800kg were zero-rated for VAT, with over 30 assessments for under-declared or over-claimed VAT against businesses in the aircraft leasing sector - protecting approximately £4.7million of VAT.

Mr Quayle said: ’We are confident we have followed the procedures.’

The assessment by HM Treasury announced today further demonstrates that the Isle of Man is committed to protecting its reputation as a leading international business centre. The Isle of Man is not a place that welcomes those seeking to evade or abusively avoid taxes.

– IOM Treasury Minister Alf Cannan MHK