08 June 2010

Jersey Finance Comments on the Zero-Ten Tax Regime Review with the EU

Jersey Finance welcomes news that Jersey will soon have an opportunity to gain further clarity regarding the EU’s position on Jersey’s business tax regime.

In October 2009 Jersey was advised that some EU member states did not consider the “zero-ten” tax regime to be within the “spirit” of the code of conduct. A review of Jersey’s fiscal strategy has been underway for some time and this has been extended to include a review of business taxation, to assess the best long-term economic approach for Jersey, both at home and abroad.

The EU Code of Conduct Group has now confirmed that in September it will start the review of Jersey’s business tax regime in accordance with the normal Code of Conduct process. This process should provide guidance and insight into what exactly is expected and required. It is understood that Guernsey will not be included in the review, following public statements that they will be working to a presumption of a 10% rate of tax. Jersey has not committed to any tax rates or structures at this stage, and will not do so until the comprehensive review and engagement with the EU processes have been thoroughly completed.

Geoff Cook, CEO of Jersey Finance commented,

The news of the EU review is a positive step for Jersey in progressing the future development of its business tax regime. Our government is considering every option, in consultation with industry, and I am very confident that whichever strategy is ultimately adopted going forward, it will be in the best interests of Jersey, both in terms of its economic stability and international reputation.

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