Jersey May Have To Reduce Corporate Income Tax To Zero

by Jason Gorringe, Tax-News.com, London

25 September 2002

Jersey and Guernsey are considering following the Isle of Man's lead and reducing their corporate tax rates to zero in order to comply with the European Union's Code of Conduct on Business Taxation, while still remaining competitive, according to a recent Jersey Evening Post report.

Speaking at a monthly Chamber of Commerce lunch, Finance and Economics Committee chief, Senator Frank Walker announced that maintaining an attractive business tax regime is crucial to Jersey's economic future.

However, according to the JEP, he stressed that any move towards reducing the headline rate corporate income tax would have to be counterbalanced by the imposition of other business taxes:

'We will need to find other ways of taxing business,' he explained to the 300-strong audience, adding that: 'The Isle of Man have not yet announced how they intend to fill their tax gap. But we want a comprehensive fiscal package.'

Although Senator Walker announced that any major decisions regarding changes to business taxation are likely to be delayed until the outcome of various international initiatives has become clear, he reassured the Chamber of Commerce members attending last week's meeting that:

'Whatever decisions are taken will be made by Jersey, not Whitehall or Brussels.'

A comprehensive report on the future of offshore following various international initiatives, including the EU's savings tax and business tax initiatives is available in the Tax-News Reports Shop at http://www.tax-news.com/reportshop/

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