Guest Blogger Barb offers her perspective on last week’s G20 Summit.

I live in Jersey, a small island (45 square miles, population: 90,000) in the English Channel that is part of the Channel Islands. More relevant to current affairs, Jersey is also an Offshore Financial Center, more commonly referred to in international circles as a dreaded Tax Haven. The finance industry is the largest, non-government employer on the island, so anything that might threaten that industry is big news here.

The entire island has been heartened by the outcome of the G20 Summit’s deliberations on offshore financial centers. Jersey has been recognised as a fully compliant, non-secret offshore center and placed on the so-called White List.

Long before this G20 summit and the recent hype over tax havens, Jersey has been in compliance with many of the guidelines set out by the G20. Just prior to the G20 Summit Geoff Cook, Chief Executive of Jersey Finance (an organization that promotes the island’s finance industry), gave a radio interview on the BBC Radio 4’s Today Programme on the topic of tax havens, and why Jersey is a “good” center.

One of the things that makes me particularly proud as an American of the G20 outcome on tax havens, is the role that President Obama played in negotiating a compromise between President Sarkozy of France and President Hu of China. Hopefully this ability to bring differing sides together and find common ground bodes well for other initiatives as well.

There is a great Forbes.com article that highlights the ins and outs of tax havens. The article also points out that for some citizens of the world it is legal to keep assets offshore.

A key element of the popularity of tax havens is that most countries tax income based on residency, unlike the US which taxes based on citizenship. As an American I must declare and pay tax on global income, regardless of where I’m living. However, as a British citizen, Wise Hubby only has to declare to the British authorities income earned in the UK. So while he lives overseas, he is legally allowed to keep his assets offshore for the purposes of British taxation. It’s a big difference from the US.

Interestingly, Jersey, the so-called tax haven, also taxes residents on global income once they have been resident here for more than three years.

As for me, I’m glad that Jersey has been put on the White List, and I’m off to mail my 2008 US tax return, and later my Jersey return!