There are concerns Jersey may not be able to afford to reduce its corporation tax to zero following ...
There are concerns Jersey may not be able to afford to reduce its corporation tax to zero following a heavy reliance on income tax as a source of government revenue, according to the Isle of Man government.
Both Guernsey and Jersey are set to reduce their corporation tax to 0%. The Isle of Man government said earlier this year it would reduce income tax for business by 1 January 2006.
Jersey is expected to implement the policy by 2007 this year and Guernsey in 2008.
According to Mort Mirgha-vameddin, general manager at Investec Bank Channel Islands, Jersey has a high budget deficit and there are concerns the lack of revenue from corporation tax could hurt the economy. The rules are yet to be set out in Jersey.
In Guernsey, features of the corporation tax strategy include an annual filing fee to be set at a rate competitive in the international market.
Domestic and offshore insurers registered under the Insurance Business Laws (Bailiwick of Guernsey) Laws 1986-1999 will be subject to 0% rate.
Guernsey companies licensed by the GFSC will be taxed at the rate of 10% in respect of the year of charge 2008. These include banks, fiduciaries, insurance managers and fund managers but not insurance companies or funds.
Jersey, Guernsey and the Isle of Man have come under pressure to comply with the EU savings directive, which insists on tax information exchange, and Dawn Primarola's Code of Conduct Committee.
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