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Jersey and the UK


having to apply a valued added tax or any part of Community policy on taxation.” That was nearly 40 years ago. In theory


it may still be the constitutional position, but the reality is that the assurance no longer holds water. When Gordon Brown, then the Chancellor


of the Exchequer, debated with his colleagues in Europe what was to become the European tax package, and Luxembourg told him that it would not cooperate unless the Channel Islands were brought in on the deal, the Chancellor committed the Crown dependencies to the package. There was no effective consultation. He had no constitutional right to do so – we are outside the EU for these purposes – but he did it.


12 businesslife.je June/July 2010


There were of course sound political


reasons for agreeing to go along with the tax package, but the harsh reality was that Jersey had little choice. Had we failed to comply, some unpleasant economic sanctions would probably have ensued because the Chancellor’s credibility was at stake. Should one criticise the Chancellor?


He is elected to protect the interests of 60 million UK citizens. Why should he allow the interests of 240,000 citizens of the Crown dependencies to stand in the way? The fact that it involved a major upheaval to Jersey’s tax system, including GST and the creation of a black hole, was not his problem. This is the realpolitik of the 21st century. In the European sphere, our constitutional rights


have been subordinated to the wider interests of the UK many times in the last 10 years or so. But even in a more domestic context, there have been instances where the interests of Channel Islanders have been ignored in favour of the interests, or perceived interests, of the UK. The cancellation of the health agreement and the more recent move to amend the Common Travel Area in breach of our ancient privileges are examples.


Taking a stance How then can we defend our economic interests and our constitutional rights? There is no easy answer. In geopolitical terms, we are a very small animal on the jungle floor. One thing that we can do, however, is to


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