Monday 26 February 2024
Select a region
News

Scottish ferry service avoids tax contributions through Guernsey ‘loophole’

Scottish ferry service avoids tax contributions through Guernsey ‘loophole’

Tuesday 14 March 2023

Scottish ferry service avoids tax contributions through Guernsey ‘loophole’

Tuesday 14 March 2023


A row is brewing in Scotland after a government-owned ferry service utilised a ‘tax loophole’ in Guernsey to reportedly avoid paying an estimated £35 million in National Insurance contributions.

CalMac Ferries is the main operator of vehicle ferries between Scotland and the islands on the west coast. It is wholly owned by the Scottish government.

The Herald reported that the firm set up a subsidiary company in Guernsey called Caledonian MacBrayne Crewing. This company employs some 1,000 crew members and through this CalMac has been exempt from paying National Insurance contributions.

Ministers in Scotland have since been lambasted for allowing the scheme to exist, especially after CalMac received millions in covid support.

CalMac used to be known as Caledonian MacBrayne Ltd and it was split into CalMac Ferries Ltd and Caledonian Maritime Assets Ltd in 2006. Notably, the asset-owning half of the firm - CMAL - put in an offer for the MV Straitsman earlier this year, but failed to secure the sale. 

23_03_08_Condor_Ferries_new_ropax_vessel.jpg

Pictured: The asset-owning half of the firm - CMAL - put in an offer for the MV Straitsman earlier this year, but failed to secure the sale. Last week, Condor announced it had purchased the passenger and freight vessel.

The ship instead was instead bought through a joint investment by Condor and the Guernsey Investment Fund. 

It’s not the first time a major UK ferry company has utilised the Channel Islands to operate independently of national laws and requirements.

In March 2022 P&O Ferries made a shock decision to sack 800 staff and replace them with cheaper agency workers. It emerged that P&O’s staff were employed through a company based in Jersey, generating a debate on what employment rights people have under ‘offshore’ contracts.

Sign up to newsletter

 

Comments

Comments on this story express the views of the commentator only, not Bailiwick Publishing. We are unable to guarantee the accuracy of any of those comments.

Once your comment has been submitted, it won’t appear immediately. There is no need to submit it more than once. Comments are published at the discretion of Bailiwick Publishing, and will include your username.

Posted by Keith Marsh on
This is wrong and all Governments (UK, Guernsey & Jersey) should sort this matter out.
To place a comment please login

You have landed on the Bailiwick Express website, however it appears you are based in . Would you like to stay on the site, or visit the site?