It has been drawn to my attention that the chair of Christian Aid in Jersey has resigned, saying:
[T]he decision made by Christian Aid UK to participate in the meeting held at St Paul’s Centre on Thursday 12th March 2009, entitled, ‘Offshore centres, past, present and future. Why reform is vital’ was hasty. The actual active involvement of Christian Aid UK, following considerable representation prior to the event from Jersey was an error of judgement, in which Christian Aid UK were na?Øve and negligent in not respecting the views of those within this Island who in recent years have been most generous supporters of Christian Aid through lent lunches, Christian Aid week collections and Overseas Aid Committee grants.
On April 24th, meetings took place which brought further illumination for Christian Aid UK to the fact that Jersey was and remains a well regulated international financial centre, committed to ensuring the highest standards of transparency in full co-operation with other jurisdictions. Jersey is not part of the problem, but our experience and models of good practice place us ahead of the game and therefore in a position to be a part of the solution. To suggest that Jersey is otherwise simply does not measure up to scrutiny.
The ongoing relationship of Christian Aid UK with the Tax Justice Network and Attack Jersey is, I believe, seriously misguided.
Personally, I can no longer represent Christian Aid whose position seems irreconcilable when on the one hand they are inaccurately critical of Jersey on Tax issues, but on the other hand keen to continue to receive financial support from the States of Jersey Overseas Aid Committee and residents of this Island.
As far as I can tell the person writing this is an ordained minister in the Church of England, although he has not signed it — the only attribution being to ‘Andy’.
I am sorry to see this person write in this way, for I feel it is he who is seriously misguided. I say so as someone who sees his work in seeking tax justice as a Christian vocation. It’s in that context that I regret to say that the person who drew my attention to this issue was probably right when he said:
I’m surprised you haven’t yet mentioned the resignation yesterday of the head of Christian Aid in Jersey, seemingly because he did not support the attack on Jersey’s finance industry by TJN and Attac, Christian Aid in Jersey has clearly been losing the financial support of local institutions which seems to be lesson in not biting the hand that feeds you.
The Church has an uncomfortable history of accommodating the government hand that feeds it. Doing so has rarely been to its credit. Apologies have almost invariably to follow. I suspect that might be the case here, but let me try to raise the level of the debate a little above that which Andy reaches. He appears to say that because the authorities in Jersey have access to the names of those who, for example, use the withholding option under the European Union Savings Tax Directive, which Jersey deliberately provides knowing that that chance of tax evasion elsewhere is significantly enhanced as a result, then it must be ‘fully cooperative with’ other jurisdictions. This is, of course, very obviously untrue because by offering this option it is refusing full automatic information exchange, which it is clear those states want. But let me instead consider this issue instead at the level at which Andy is hopefully qualified to engage in it i.e. at the Biblical and maybe theological level. I stress that in doing so I am speaking purely as an individual and that I do not suggest for a moment that what I say represents in any way the opinion of any organisation I work with.
I think there are a number of unquestionable moments when Jesus defined what faith was. One was of course when offering the two principles of that faith. As recorded in Matthew:
One of them, an expert in the law, tested him with this question: ‘Teacher, which is the greatest commandment in the Law?’Jesus replied: 'Love the Lord your God with all your heart and with all your soul and with all your mind.' This is the first and greatest commandment. And the second is like it: 'Love your neighbour as yourself.' All the Law and the Prophets hang on these two commandments.
That seems like a statement he meant to be taken seriously. But note how the story develops in Luke, where the questioner asks “But who is my neighbour?”. I cannot see any way in which we can know that in Jersey: anonymity is guaranteed there so that we are denied knowledge of who we are dealing with in that jurisdiction and others like it. I see no way that this is consistent with the teachings of Christ. One cannot know one’s neighbour in that case: worse still, that neighbour might abuse us with impunity, and I believe they do. How can that be consistent with the Law?
Let me take another section of Luke I think pretty important (Ch4 18-19) when Jesus said in his first public address:
The Spirit of the Lord is on me, because he has anointed me to preach good news to the poor. He has sent me to proclaim freedom for the prisoners and recovery of sight for the blind, to release the oppressed, to proclaim the year of the Lord's favour.
I believe that this is what Jesus really did mean his ministry to be about: I think that is played out in the Pauline theology which sees Jesus as the fulfilment of the promise made to Abraham on behalf of the people of Israel, which from the time of Jesus onwards would be extended beyond the Jews to the world at large. Jesus when saying this was, after all, referring quite deliberately to Isaiah 61. There is also no doubt at all that when proclaiming the year of the Lord’s favour Jesus meant he was declaring a Jubilee — a year in which debts will be forgiven and the poor set free, based on the teaching of Leviticus. That book, which (I fully accept) is hard to always apply to modern day life does in the chapter to which I link set out standards for behaviour which we can, however, all recognise as remaining ethically appropriate: that our business conduct be fair, open, transparent, accountable and respectful of the condition of each human being, all of whom are valuable.
I cannot relate that to tax haven activity. As Christian Aid has shown, tax havens cause deaths in developing countries. This is not by chance: tax havens as secrecy jurisdictions set out to do this. Secrecy jurisdictions are places that intentionally create regulation for the primary benefit and use of those not resident in their geographical domain that is designed to undermine the legislation or regulation of another jurisdiction and that, in addition, create a deliberate, legally backed veil of secrecy that ensures that those from outside the jurisdiction making use of its regulation cannot be identified to be doing so. The fact that Jersey knows the identity of those undertaking this abuse which I think is in contravention of Christian law makes no difference to its standing: it does nothing to stop it. Whether it is legal does not matter: Christians of all people have a duty to work to a higher standard.
And Christians of all people have a duty to bear witness to that. as the liturgy says in the post Eucharist prayer of the Church of England says:
Almighty God, we thank thee for feeding us with the body and blood of thy Son Jesus Christ. Through him we offer thee our souls and bodies to be a living sacrifice. Send us out in the power of thy Spirit to live and work to thy praise and glory. Amen.
This is not the moment when the service ends: it is the moment when the service to God, the other 167 hours of the week if you like, begins. A Christian says when offering this prayer that they will continue that service until they next come to the Eucharist. There is sacrifice in the process of doing so. That’s not easy. It’s not meant to be. It involves, as the word sacrifice implies, forgoing what is available but inappropriate in the pursuit of the path of faith if one is to live and work in accordance with that faith.
I do not see how the work of offshore finance is consistent with living and working to the praise and glory of God. I cannot see how it treats a neighbour as oneself, for the very essence of that activity is to deny to others what one has claimed for oneself. I cannot see how that trade brings good news for the poor, for it is designed to increase the gap between rich and poor, and most assuredly does so. I cannot see how there is in the ethical standard that Jesus required of those who follow, however inadequately in his footsteps.
In saying that I am not condemning those who work in offshore finance: many have no choice. Their home jurisdictions have been taken over by offshore finance. They are left with little choice but work in a sector that is doing harm, at least when seen from what I believe to be a Christian perspective. But there are many — those who set up and direct these organisations, those who support them in politics, those who excuse them in the Church, who have a choice. When they make the wrong choice — are wide of the mark — sin if you like — then it is the duty of the Church to say so. When it does not it fails in its duty. I think there is risk of that in Jersey.
And in saying so I am not for a minute decrying banking, finance or commerce. The tale of the Good Samaritan which follows on from the question ‘who is my neighbour?’ in Luke did require that the Good Samaritan had the means to settle the innkeeper who cared for the victim of a crime. But it did not ask that he secured those funds unethically: his ethical act could not have been condoned his unethical procurement of the means to undertake it. That is not possible.
So I will not apologise for believing in the merits of trade, of business, and of the right to make an honest profit. But I stress the word honest. And I cannot see how honesty is possible behind closed doors, when the light of transparency is denied, when the accountability for ones actions which is at the heart of Christian belief is not present — both here and now and in what is to come.
Put simply: I think the Chair of Christian Aid in jersey is profoundly wrong. For me at least the action of the Tax Justice Network is profoundly motivated by Christian belief, by the conviction that this is indeed the way in which I am required to ‘live and work to Thy praise and glory’.
You can differ if you wish. I’m sure some will. If done appropriately then I will of course welcome comments. What would be really good was if the church in jersey could accommodate alternative opinion as well. Surely, that is part of its role? But I should warn, rather more than usual I will moderate those out which do not respect the aspect of faith within this post.
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Arnald,
Well, at least that’s clear.
But seriously, the issue is that in my experience very few – if any – offshore vehicles are “tax dodging”. In a way, I wish they were, but the sad truth is that its pretty much all pimping for Arabs these days (or setting up collective investment funds).
Paul
Data from Jersey Finance does not support your claim
Richard
From my experience a large portion of work in the CDs is tax compliant and the tax authorities in the client’s home jurisdiction are well aware of that client’s dealings.
There is nothing wrong with tax planning.
Provided that the tax laws in the client’s home jurisdiction are kept informed, or the tax authorities can get access to the information through proper channels, why should this information be avaliable to anyone else?
A persons financial affairs are just as confidential as thier medical history and shouldn’t be avaliable to all and sundry.
Richard,
On the source of deposits you may be correct, though I am not sure what methodology is used (i.e. if an account is held in the name of a BVI company owned by a Jersey trust for an Arab family, is the deposit listed as being Jersey, BVI or Arab sourced? i don’t know).
But if you look at the litigation that goes on in Jersey (and there is a Jersey Law website that prints all recorded and unrecorded judgments) you’ll see that the vast majority of trust litigation is between members of extended Arab families. And I’d say that is probably the best objective guide you could get to the underlying source of work in the Island.
Paul
What nonsense – all that says is that those people have the resources and inclination to litigate, nothing more
Richard
Barwick
You say “A persons financial affairs are just as confidential as thier medical history and shouldn’t be avaliable to all and sundry.”
Agreed. I have said so, often.
The affairs of a trust or a limited liability entity are not, as you and others have also argued, the same as those of the shareholders. So your argument has absolutely no foundation at all. In fact, it’s wrong.
And as legal constructs trusts and limited liability companies have, in my opinion, the duty to be transparent. They alter property rights. They must be accountable for that. And transparency is the only way in which that is possible.
You have not in any way proved otherwise. Unless someone does add any new argument this thread is closed.
Richard
Richard
I’m sorry if I’m missing something in your comments but I still don’t see why you would/should need to have the ability to look at any private company’s beneficial ownership or financial statements unless you were planning to trade or transact with such company. Please hear me out on this one.
If a wealthy individual, i.e. a UK-resident but foreign-domiciled individual has chosen to hold certain of his assets in an offshore company in order to address forced heirship complications in a relevant country, it is a fact that he has acted totally lawfully. This is fact, although I accept that you would argue that this might be an abuse. But let’s focus on the factual position rather than on the social argument.
The offshore company holds passive wealth, i.e. an investment portfolio and cash. Its sole third party relationships are with an investment manager and/or a bank to manage the portfolio and to hold the cash. It has no trading activity with any third parties and has no need for any such trading activity. It is not seeking any additional investment from any third parties. Assume that the beneficial owner is fully tax-compliant.
How and when would such a company come into contact with you, to cause you, as a member of the public, to ask about the company’s beneficial ownership and financial condition ? It isn’t looking to trade with you, so it is not promoting its “trade” as it simply isn’t trading and has no desire to do so. It’s no different from you walking up to stranger in the street and saying: “I don’t know who you are or anything about you, but I want to know what line of business you are in and how much you are worth so that I can decide whether or not I want to do business with you.” But that person is not even looking to trade with anyone and may not even be in business (let’s assume he is a civil servant). The question simply has no relevance to you or to him. It’s no different from you as a man on the street asking for details of private companies.
I really cannot see any circumstances other than (a) a trading company wanting to solicit business from the public, or (b) public company seeking investment from the public, where there would be a need for that company to reveal exactly who is behind it and how healthy its finances are. In every other circumstance it is simply not relevant, and is akin to asking a complete stranger to disclose information to you for irrelevant reasons.
Whether or not incorporation of a private limited company is a privilege is surely a separate issue from having to be transparent and give up all private information to those who simply have no need or desire for such information other than for “nosiness” purposes. What on earth would the man on the street usefully do with that information ?
Rupert
You can’t ignore the social argument
You can’rt ignore the fact I won’t know I need information on a company until I have that information – so it has to be provided for all companies.
Please present arguments in future, not excuses for abuse
Richard
Richard
I’m not ignoring the social argument – I’m merely trying to understand your point. If a company is not a trading company and therefore has no means or cause of transacting with you, then how could you conceivably have any likelihood of needing information about that company ? It has no prospect of concerning you. That is a very valid question and is not an excuse for abuse.
At the moment your argument is no different from me demanding a copy of the full details of the will of every single deceased person in the UK so that I can check for myself whether I might have been a beneficiary of their will, but already knowing that I don’t even know 99.99999% of the UK population so that its all totally academic. The information that I would glean about that deceased person’s will that has no relevance to me is not information to which I should be entitled.
I’m presenting a very good argument here, as requested by you, and I think its a more than reasonable one to ask you to answer rather than to simply claim that I am making an excuse for abuse.
Rupert
You are ignoring the social issue: society allows property rights to be distorted by limited liability. No one has to use. No one ever has to use it offshore – categorically I am right in saying so.
In that case accountability is the price paid.
A will is potentially private – a company never is.
And since most companies can do absolutely anything I must have the right to know in case it does.
This thread is closed. I have got to the point of complete boredom with your perpetual excuses for abuse – none of which include an argument and all of which, like Paul’s abuse facts – in this one by confusing the personal with the corporate.
Richard