A scandal on the Isle of Man shows how reactionary it is. And not for the first time.

Someone getting 'birched' in the olden days
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The Isle of Man, a tiny island in the Irish Sea that is one of the UK’s three British ‘Crown Dependencies’, has just become an unlikely focal point in the global debate about Black Lives Matter following the death of unarmed African American George Floyd in the US. Because comments made by a presenter during a broadcast of the island’s local radio station have sparked outrage well beyond the shores of the obscure tax haven.

We shouldn’t be surprised, though. The Isle of Man has a long and checkered past of clinging to reactionary ideas. Throughout its history, it has had to be dragged kicking and screaming into the present on issue after issue, including some downright medieval practices long abandoned on the British mainland. Meanwhile, its tax haven status means it has been ripping off the British public as well as serving as a headquarters for all manner of sleazy financial shenanigans.

This sordid record raises big questions about the continuation of its special status.

Dismissive remarks lead to suspension

On 3 June, Manx Radio presenter Stu Peters got into an on-air spat with a Black island resident. The man had called in to challenge Peters about comments he had earlier made on an online forum. Peters is believed to have written “all lives matter” and expressed other sentiments aimed at downplaying the issue of white privilege. He also implied that a protest planned to take place in the island’s capital was pointless, saying “I don’t understand why people on the Isle of Man are protesting in support of Black Lives Matter in America, which is 3,000 miles away”.

In response, Manx Radio announced that it had suspended Peters until further notice and that the incident was being referred to the Communications Commission for review. A statement read: “It is important as the Public Service Broadcaster for us to emphasise that we do not condone racism, nor are the views of our presenters always the views of Manx Radio”.

Far from an isolated incident

The remarks have come under heavy fire on social media as well. But it seems that Peters’s attitudes are hardly anomalous in the Isle of Man. One Black island resident posted on Facebook a long list of racist incidents that she herself and other Black people on the Isle of Man have been subjected to. And political candidate Haafizah Hoosen said she had been subject to “terrifying” racism on the island:

Once my candidacy was formally announced and publicised, it became very apparent that racism and Islamophobia is not dead and since the announcement I have been the subject of multiple racist and Islamophobic comments online and (terrifyingly) in person.

Read on...

It’s also worth pointing out that Peters’s remarks were not just insensitive but also ahistorical. Because like many places in Europe, the Isle of Man played a significant role in the trans-Atlantic slave trade in which millions of people were forcibly taken from Africa to the so-called New World in bondage.

Absurdly antiquated

For a number of obscure historical reasons, the island makes its own laws – even though the British government is responsible for its defence and international affairs. And on social reform, in particular, the Isle of Man has used its self-governance to stubbornly cling to laws long ago repealed on the British mainland.

For example, it didn’t abolish the death penalty or decriminalize homosexual relations between consenting adults until 1992. Even more shockingly, a barbaric form of corporal punishment known as ‘birching‘, in which a person’s bare buttocks are whipped with tree branches, was still practised on the island as late as the 1970s. The island only reluctantly abandoned it following the intervention of the European Court of Human Rights. And as with capital punishment and anti-LGBTQI+ laws, birching was not officially outlawed until the early 1990s.

It gets worse…

The island is also a seedy tax haven that has both ripped off the British public on the mainland and facilitated all manner of shady financial dealings.

In 2007, for example, tax campaigners discovered that the Isle of Man government was receiving hundreds of millions of pounds per year more than it should from the UK government via an arcane ‘tax sharing’ mechanism that dates back to the 18th century. Known as the ‘VAT sharing agreement’, it essentially means that the Isle of Man and UK government pool revenue from various value-added taxes each year.

But due to a (supposedly accidental) miscalculation, the Isle of Man was receiving as much as £233m per year more than it should have been every year. This payment reportedly accounted for roughly a third of its government’s income in some years.

Undermining the UK’s tax system

This overpayment has essentially subsidized the Isle of Man’s ability to remain a tax haven. The island’s so-called ‘low-tax jurisdiction’ includes a 0% corporate tax rate along with a series of other low-tax measures including no capital gains tax and no inheritance tax. In 2017, about a decade after the overpayment was discovered, reports emerged that, despite the UK government’s moves to correct the error, the Isle of Man was still receiving more than it should.

Tax justice campaigner Richard Murphy, an accountancy professor at City University of London, said at the time:

It looks as if the UK is still heavily subsidising the Isle of Man to be a tax haven….

Bizarrely, the UK is effectively paying the Isle of Man so that it can undermine our tax system by offering low or zero tax rates to those seeking to avoid their UK tax bills.

As The Canary has previously reported, the combined cost to the British public of the tax avoidance, tax evasion, and tax-not-paid that is facilitated by the global tax haven system (of which the Isle of Man is a part) totalled £122bn in 2014. In a cruel irony, this amount is more than the total budget cuts imposed by then-prime minister David Cameron for the entire duration of his first government (2010-2015). This is no small matter given that multiple research reports, including one conducted by the British Medical Journal and another by the Institute for Public Policy Research, have concluded that just some of the Tories’ austerity policies have led to the deaths of at least 120,000 people since 2010.

Shady dealings

The Guardian, meanwhile, reported in 2017 that:

Manx companies [based in the Isle of Man] have been used to transfer Kremlin-controlled state funds into Twitter and Facebook; they have obscured the financial connections between two Premier League football club owners; and they have been used to issue $1bn (£764m) of tax refunds to wealthy private jet owners, including sanctioned oligarchs from Vladimir Putin’s inner circle.

The combined Isle of Man entries in the Panama Papers and Paradise Papers, meanwhile, total more than 30,000 (the Isle of Man’s population is only about 84,000). Meanwhile, anyone who dares to shed light on this situation is quickly dealt with by the island’s powers-that-be. One whistleblower named Catherine Turner, a middle-aged mother of two, was subjected to a vicious and protracted smear campaign for exposing some of the Isle of Man’s dirty secrets to the global public.

Jeremy Corbyn would have fixed it…

Former Labour Party leader Jeremy Corbyn suggested in 2016 that the UK government should consider direct rule on the Isle of Man and other ‘Crown Dependencies’. Corbyn pointed out that they could be given a simple choice to either harmonize their tax codes with that of the British mainland or else lose their special status. He noted that this could easily be done since the government in Westminster is ultimately responsible for their ‘good governance’. Corbyn said:

If they have become a place for systematic evasion and short-changing the public in this country, then something has to be done about it. Either those governments comply or a next step has to be taken.

And far from representing some kind of historical first, reimposing direct rule on a British protectorate has already happened within living memory. In 2009, for example, the BBC reported that “The UK has imposed direct rule on the Turks and Caicos Islands after an inquiry found evidence of government corruption and incompetence”. Indeed, the Isle of Man’s current political set-up only dates back to 1986 when Miles Walker became its first ‘chief minister’. So bringing the Isle of Man back into direct rule would be relatively simple – and with a population of roughly 84,000, the island would get one MP in Westminster just like the Isle of Wight (which actually has a slightly larger population).

Some residents might complain that doing so would ‘make the island sink’ by making it less attractive for businesses to locate there and, in turn, lowering its population. But we must consider why, of the many minor islands around the UK, only one should be allowed to set its own tax rates and, in the process, undercut neighboring jurisdictions’ ability to raise public money. All of these other islands, from the Isle of Wight to the Shetland Islands, sink or swim based on their own merits with the same tax code as the British mainland. And if the Isle of Man’s population decreases as a result, then this would simply be a case of an artificially high population caused by unnatural economic conditions shrinking back to a more normal population under natural conditions.

…but now who will?

Unfortunately, meaningful action against the Isle of Man and other tax havens will likely be off the table in the UK for the foreseeable future. Because as The Canary has also previously reported, many Conservative Party backers, and possibly even sitting Tory MPs themselves, benefit from this setup.

Tax justice activists must press hard to keep this issue on Labour’s agenda in the post-Corbyn era. Because though the Isle of Man might have belatedly and reluctantly come around to civilized thought on social issues, it seems to still be trapped in an eternal past. As crude and ignorant as they were, Peters’s comments form just one small part of a rich tapestry showing why that’s the case. Moreover, the island continues to abuse its ability to set its own tax rates, causing great harm to others in the process. The only way to fully bring the Isle of Man into the 21st century is to end its special status once and for all.

Featured image via Wikimedia Commons

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  • Show Comments
    1. This is a rather one-sided account of the Isle of Man’s political development. As a Manxman and UK Labour Party activist, I’m disappointed that The Canary (which I support) has not also mentioned that the island was the first place in the world to give votes to women, and was recently congratulated by Peter Tatchell for legalising same sex marriage AND heterosexual civil partnerships before the UK. The tax rules could be better but have been cleaned up considerably. The small but active Manx Labour Party is a positive force (as are the Manx Greens and the Isle of Man Freethinkers). And, as your correspondent states, Manx Radio immediately suspended Stu Peters for his on-air comments. The island is proud to be “living in the past” – the steam railway and electric trams are a major tourist feature – but has made big strides in promoting progressive social policies in recent years.

    2. Yes and the Ukanian Tory party believes it championed various progressive measures whereas, in reaity, it dragged the country back to the nineteenth century in an attempt to claw back everything lost after the post-war compact, which gave us a state committed to the Welfare of its citizens. Buzz words such as ‘big strids’ ‘greenparty’ and ‘UK Labour party’ are just that – it’s like Labour career politicians claiming to have been ‘Marxists’. An easy CLAIM.

    3. There is now seriously credible evidence that the George Floyd ‘killing’ was staged i.e. it was a ‘false flag’ event designed to create even more societal chaos especially in mixed race countries across the world – perhaps primarily for political purposes in the USA (either for or against Trump!), or alternatively as a smokescreen for other developments, such as the rush to vaccinate everyone.

      All that anger and resentment and destruction – and bizarre ‘knee-bending’ – based on a lie?

      The video evidence on this site is compelling: http://tapnewswire.com/2020/06/more-media-outlets-cotton-on-to-floyd-fakery/

      1. EVEN IF (huge IF!) this WAS a “false flag”, why does it not occur to you that then the REASON it has gone National (and global) is BECAUSE OF THE OMNIPRESENT POLICE VIOLENCE?

        Even IF that one death “was a lie” as you graphically claim, why are you not indignant about the 10S OF THOUSANDS OF MURDERS BY COPS THAT REGULARLY HAPPEN?

        In short, whatever the merits of your claims regarding false flags, the REAL mirror that you are holding up is to yourself – Do you often find yourself saying “I’m not a racist BUT…”?

        Or, wild guess, do you just skip those 5 preceeding words?

        Oh, I wouldn’t be the slightest surprised to learn that the far-right Trumpists AND/OR the far-right ‘RepDem Establishment Deep State’ were using fake flags for their own intended political gains – the same tactics used in Libya, Syria, and Ukraine.

        Both Soros and Trump have equally deep ties to the far-right.

        Here’s a question to boil your white supremacist troll brain – do you think they are working together, or are competing for the same turf?

        HAVE FUN!!!

    4. The feature “A Scandal on the Isle of Man” although largely factual is short on context and balance. Similarities to the Isle of Wight for instance, do not bear historical comparison.
      The Isle of Man had an established parliament and trading links with other Celtic nations while England was still a collection of warring tribes
      The Vikings ruled over a large part of Scotland and Ireland from their base on the Island and although ultimately governed from Norway the Island was largely autonomous with it’s own language and laws
      Scottish rule began after the Treaty of Perth in 1266 and only after the act of union in 1603 did the English get a say in the affairs of the Manx.
      The Island was left to rule itself overseen by the appointment of an English Governor to ensure all rents and taxes were paid to the Stanley family, who now effectively owned the Island
      Our young men and women went off to fight and die for the British Empire in all of it’s wars and our land and ports were given over to British military bases. We also housed many thousands of prisoners of war in hotels and internment camps
      We are often portrayed as some kind of Celtic hillbillies, when in fact generations of Manx made their living as seafarers and as such were well traveled and familiar with other nationalities.
      The status of “Tax Haven” was bestowed upon us by the British establishment as the empire declined and the last vestiges of it were put to use as a network of shadow banks and trusts. See the documentary “The Spider’s Web” Britain’s second empire for a full account
      The last thirty years has seen an influx of settlers from nations as diverse as Israel and Indonesia , these people have been for the most part welcomed and valued as citizens by a largely tolerant indigenous population
      We have been slow in some of our reforms such as banning the birch and legalising homosexuality, but the most voiciferous opponents of change have been the retired English Tories who want to keep the Island as some kind of 1950s theme park
      We have a thriving arts scene, our beaches anr kept spotless by an army of volunteers.
      There is a Manx Labour Party, Mec Vannin, a nationalist movement. A thriving Friends of the Earth, sixteen year olds can vote and same sex marriage and civil partnerships ar enshrined in law
      We frequently top the quality of life index for nations and apart from the weather it’s one of the best places to live on the planet
      David Buttery
      Isle of Man

    5. Whatever the merits of Mann, and it is a very picturesque place to holiday, surely it is also obvious to most ‘normal’ residents that being “A Tax Haven” is shortchanging the rest of the British Isles let alone Europe as a whole.

      That the vast majority of beneficiaries are offshorers, and almost certainly mainly English over-rich scum (The very same people to blame for Manx economic woes to begin with, like all UK regions), would possibly mean there is little resistance to changes.

      Sadly, due not least to the execrable Gruniad (Note that ‘Paper of Barely Note’ only managed to find evidence of GASP! Russian use of tax-havens… yeah right), Corby was effectively backstabbed and replaced with a ‘nice loyal Establishment arselicker’ – the LAST thing Starmer will ever do is seriously undermine the offshoring tax-avoidance industries.

      Isn’t it funny that the rich never have enough, and it’s always the poorest and weakest who suffer?

      It’s almost like the private schools and Elite schools churn out brainwashed sociopaths DELIBERATELY! 😮

      “Perish the thought Minister, perish the thought…”

    6. Whilst I’m sure its only a coincidence, I remember in my younger days, a Trust Fund kid who lived on the Isle of Man (who subsequently moved to the USA to become a journalist) who went by the same name as the author of this drivel.

      Could this be yet another case of “Gamekeeper turned Poacher”?

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