If I had a pound for every time we'd reported on the UK government saying they were going to tackle that previously reported Channel Islands VAT loophole I'd have, well, seven pounds. But still, you'd think after seven attempts of tackling it they might have closed it by now. This is the loophole that enables mail order operations run by the likes of Play.Com and some of the big supermarkets to sell CDs and DVDs from bases in Jersey without paying any VAT, meaning they can always undercut independent music retailers, who can't afford flash setups in the Channel Islands. It also means, of course, that the government loses out on a not inconsiderable sum of tax revenue.
Anyway, in a document released alongside this week's pre-budget report from the Treasury the government made yet another commitment to get to grips with the loophole. The document said: "'Despite the attempts of the Channel Island authorities to limit the exploitation of these rules, the cost of this relief has increased in the last six months to around £90 million per annum. The government will assess the case for reform to protect tax revenues and will take into account the wider public interest, by balancing the compliance costs on carriers and importers with the impact on UK based retailers".