The politician in charge of stimulating Jersey’s economy has warned that the sector could become the victim of its own success if more companies turn to Jersey to avoid tax.
Deputy Gerald Voisin, president of the Economic Development Committee, has said that the ‘bubble will burst’ if the Island fails to distinguish between locally based internet mail order companies such as Play.com and Flying Brands, and those like Asda who are using Jersey to fight a UK-based price war.
This week the supermarket giant launched an internet service selling cheap CDs, DVDs and computer games from the Island.
They are exported from Jersey to take advantage of a European Union ruling which exempts goods from VAT if they are worth less than £18.
Asda joins a growing list of major retailers, such as Tesco, Amazon, Boots and Lastminute.com, which have set up operations in Jersey.
Like Boots, Asda has employed the services of a third party called The Hut.com to supply the goods to customers.
Although also based in the UK, The Hut.com has set up a Jersey-registered exempt company that sub-contracts Jersey Post Logistics, a division of States department Jersey Post, to stock and ship the orders from the Island.
