Benefits In Kind Could Face Tax In Jersey

by Jason Gorringe, Tax-News.com, London

21 March 2002

According to a report in Tuesday's Jersey Evening Post, benefits in kind such as free use of a company car, free accommodation, and free parking spaces could soon become subject to tax under new proposals being considered.

According to the paper the move, which would generate an estimated £2 million in additional annual revenue, was agreed in principle by the Finance and Economics Committee last month, and is now under public consultation.

However, Malcom Campbell, Jersey's Comptroller of Income Tax, reassured workers that the proposed tax would affect their employers rather than them. Under current rules, employers are permitted a deduction from their taxable trading profits on benefits in kind paid to an employee. However, under the new proposals, this deduction would be abolished.

Mr Campbell admitted to the Jersey Evening Post that when a similar proposal was put to the public nine years ago, it was roundly rejected. However, he argued, the economic climate is different in 2002, a factor which shold be taken into account by the Jersey population.

'We need to raise additional monies and we are looking at budget deficits,' he explained. 'Before, we did not have the budgetary problem we have now.'

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