IOM Welcomes Zero-Ten Outcome

by Jason Gorringe, Tax-News.com, London

19 September 2011

The Isle of Man's Treasury Minister Anne Craine has welcomed feedback from the EU Code of Conduct Group on business taxation that it has agreed in principle that the Isle of Man’s business tax system will no longer be considered harmful if it goes ahead with its proposed withdrawal of the attribution regime for individuals (ARI).

The long-awaited announcement follows months of discussions between Jersey, Guernsey and the Isle of Man and the European Union after they were notified that provisions in their zero-ten tax regimes ran contrary to the 'spirit' of the EU Code of Conduct.

Both Jersey and the Isle of Man had earlier committed to remove similar elements of their regimes, relating to deemed distribution and attribution provisions, identifying these as the areas being concentrated on by EU negotiators.

Abolition of the ARI from April 2012 was announced by Craine in her Budget speech in February 2011 and endorsed overwhelmingly by parliament.

Craine commented: "This is a positive development for the Isle of Man. It is an endorsement of Government’s strategy of responsible engagement with international concerns while promoting the island’s legitimate interests."

The Group’s conclusion is subject to formal confirmation by ECOFIN (the EU’s Economic and Financial Affairs Council) in December.

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