Savers with money in tax havens such as Guernsey and the Isle of Man could be forced to pay tax on their offshore bank accounts to fund a deposit protection scheme.

Industry experts believe that the measure may be announced as part of a government-backed review into offshore financial centres.

Andrew Jupp, head of tax at Tenon, the accountant, said: “I would not be surprised if we saw a tax levy on income from offshore bank accounts as the quid pro quo for granting some level of protection, such as guaranteeing a certain level of cash deposits. The Treasury could try to strike a deal with overseas banks to ensure a certain amount of interest is withheld at source.” 11-Dec-08.

http://www.timesonline.co.uk/tol/money/tax/article5321356.ece?Submitted=true