Zero Ten Design Proposal and response from HM Treasury

1240/5(2929)

WRITTEN QUESTION TO THE MINISTER FOR TREASURY AND RESOURCES BY DEPUTY G.P. SOUTHERN OF ST. HELIER

ANSWER TO BE TABLED ON TUESDAY 20th JUNE 2006

Question

Would the Minister inform members –

( a ) w h e ther he has forwarded to H.M. Treasury the Zero/Ten design proposal for consideration and, if

so, can he give members an indication of when he expects to receive a response;, (whether and in what time;

( b ) w h e ther he expects he expects the proposal to be considered by the EU Code of Conduct Group and

ECOFIN and , if so, in what time scale; and,

( c ) w h e ther he has been notified of the outcome of the consideration of the Isle of Man and Gibraltar

proposals and how these differ from Jersey's proposals?

Answer

Before addressing the specific points in this question, it is for consideration whether sufficient responses have already been given in the written answer to Question No. 2862 tabled on 16th May 2006. This Question appears to cover substantially the same ground as that contained in Question 2862 on which I believe a full answer was given.

1. Asthe Zero/Ten DesignProposaldocument makes clear in the tableatParagraphNo. 2.3.2, the viewsofHM Treasury are sought and accordingly a copyof the proposal hasbeensent to the Treasury. We expectongoing discussion with the TreasuryabouttheProposalaheadof it being presentedby the U.K. to theEU Code of Conduct Group later this year. This discussion will principally take the form of meetings between the Treasury and Jersey representatives.
2. This is partly addressedin(a)above and in the answer previously given to Question No.2862.The Proposal will beconsidered by theCode Group and ultimately will form partof a CodeGroupreporttoECOFIN. Dateson this arenotclearas the Group itself hasyetto finalise its working timetable and agenda for the remainderof2006.

I t is worth reiterating that the States decision to adopt the Zero/Ten proposal is not subject to the formal

approval of the Code of Conduct Group or ECOFIN. Jersey has domestic competence in fiscal affairs and any suggestion that an EU body has the power to dictate our fiscal policy is to undermine that competence and the Island's constitutional rights. It should also be noted that the Code of Conduct Group is not a body with the power to enforce; even amongst the EU member states themselves. The process is one in which Jersey is participating voluntarily because the Island is not in the EU's fiscal territory. Nevertheless, regard will be had for any views expressed by the Code of Conduct Group in line with our policy stance as a good neighbour' to the EU.

3. We have not been notifiedby H.M. Treasuryoftheoutcome of theirconsideration of the Isle ofManand Gibraltar  proposals  as H.M.  Treasury applies  the same  confidentiality  to  those discussions as we are informed applies to the Jersey discussions. We follow matters relating to theseproposalswhich are in the public domainas would beexpectedas part of a formalmonitoring process of competitor activity. This includes actual legislation generatedbythese jurisdictions to give effect to their respective proposalssince this will highlightanydifferences from our approachwhichmayberelevantto the Jerseyposition.At this time such legislation hasnotbeen finalised but is pending andwe take note of the content ofsuch legislative proposals and await definitive assessment of them that actual legislation will provide. It is also worth pointing out in this context that,becauseofGibraltar's different positioninrelationto the EU, the Gibraltar proposals will be subject toEUState Aid Rules which in recent times have been used by the EUto deal with fiscal arrangementsin the Member States that areconsidered to be in conflict with the objectives of the EU

Treaties. Jersey is not subject to these Rules.