David Snook discovers a solid economic landscape

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Everyone who lives and works in one of those offshore e-gaming jurisdictions reckons that a prime motivation for incoming licensees is the pleasant living environment the destination provides.

They probably have a point, but in having visited and written about the plus-points of a number of these jurisdictions – and appreciating their natural attraction – I have never yet experienced the degree of passion for their island that the Manx business community expresses.

And nearly all of the people I spoke to weren’t Manxmen themselves – they were ‘incomers’, people who have only been there a few years, usually brought in for their expertise in law, banking, accountancy, specialist management executives. They all, it seems, fall under the spell of this island, 13 miles wide by 32 miles long, set in the Irish Sea. From its highest point on a clear day four countries can be seen, Wales, England, Scotland and Ireland.

Yet this island with its Siren appeal has only 80,000 inhabitants, more than a quarter of them in the capital, Douglas, and for all its proximity to the other countries, it is independent. Technically, the Isle of Man is a British Crown Dependency but is self-governing, having its own ancient parliament, the Tynwald.

The island does not, however, qualify as part of the European Union, even as an associate, and Manx citizens are not permitted to work within the EU without restriction – similarly an EU citizen has no direct rights in the Isle of Man.

Where it does score heavily, however, is fiscally. If you run a business there are very distinct advantages to running it in the Isle of Man. There is no capital gains tax, wealth tax, stamp duty or inheritance tax and there is a top rate of personal income tax of 20 per cent - and there is even a cap on that. There is no corporation tax, except a small one on bank profits. Understandably, offshore banking is one of the key sectors in the economy – along with e-gaming.

It is the latter that concerns us here. Why should an e-gaming operator from another part of the world seek a licence to operate out of the Isle of Man?

Perhaps it is best put by Bill Mummery, once the Manx Government’s head of e-gaming development and these days running Celton, SBOBet’s Isle of Man company. He said: “I have always subscribed to the view that sustained economic development, wealth creation for the benefit of all and the highest possible quality of life is best achieved where there is an optimal relationship between the public and private sectors. The model that appears to work best is when government sees its role as creating the macro economic, legislative and regulatory framework within which the private sector is given the opportunity and responsibility to maximise its potential.

To achieve this requires a genuine partnership between  government and the private sector with ready access to key decision-makers on both sides. The Isle of Man delivers in all of these areas and truly creates an economic landscape within which people and organisations are given the freedom to flourish. It’s also a wonderful place to live, work and play.”

This report can be read in full in the fourth 2012 edition of iNTERGAMINGi