The island’s VAT treatment of the importation of aircraft into the EU has been a key issue from the so-called Paradise Papers that has been reported by international media.
According to a trove of data stolen from international law firm Appleby in 2016, the Isle of Man refunded VAT for private aircraft owned by wealthy individuals, including Formula 1 champion Lewis Hamilton.
Fight back
Quayle said: “This media attention has centred on the importation of business jets into the EU through the Isle of Man, with a particular focus on the VAT treatment of aircraft leasing arrangements.”
The chief minister said that “where the Isle of Man’s integrity is challenged we will not be complacent”.
He cited the intense media and political focus on offshore financial centres and tax and transparency standards, “not only from the UK but further afield across France, Germany, Italy, Russia, Japan and the US”.
He expects the furore will continue for several months.
“Our overall message remains clear; the Isle of Man is not a place that welcomes those seeking to evade or aggressively avoid tax.”
UK assessment
Quayle confirmed that he briefed members of the House of Keys, the Isle of Man’s seat of government, in October after it was contacted by the International Consortium of Investigative Journalists (ICIJ), which broke the story.
Citing a press release issued by the cabinet on 24 October, he confirmed that the Isle of Man Government has invited HM Treasury to conduct an assessment of the practice for the importation of business jets via the Isle of Man into the EU.
“If there is any evidence of wrongdoing then all appropriate action will be taken against individuals or companies,” he said.
“As I have confirmed, during the course of an internal review, we have found no evidence of wrongdoing, or reason to believe that our customs and excise division has been involved in the mistaken refunding of VAT.
“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.
“However, we acted swiftly and decisively and have taken action to demonstrate that the Isle of Man is a well-regulated, open and transparent member of the international community,” Quayle said.
