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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.
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.
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