Jersey To Review ISE Regime

by Jason Gorringe, Tax-News.com, London

11 August 2011

In a public consultation released on August 5, the Jersey government has sought the views of businesses on the International Services Entities (ISE) regime.

International Services Entity status is an alternative to registration for Goods and Services Tax (GST) for businesses that mainly serve non-residents. It was primarily created to raise revenue from businesses in the financial services industry while helping to reduce the administrative and compliance burden that GST would place upon them.

The ISE regime was introduced in parallel to the Goods and Services Tax to raise revenue from the financial services industry. Businesses which meet certain conditions can become an ISE if they pay an annual fee. The fee varies depending on the type of business.

Now that the ISE regime has been in place for 3 years, the Minister for Treasury and Resources has launched a consultation to review whether it is considered fit for purpose, to identify any problems and to get views on how it can be improved.

The consultation will also ask questions on:

• Achieving greater equity between the ISE fees charged;
• Reducing the compliance burden associated with ISEs; and,
• Raising GBP1m additional revenue from ISEs.

In last year’s budget statement, Minister for Treasury and Resources, Senator Philip Ozouf, made a commitment to consult on ISEs. Referring to the consultation, Senator Ozouf said: "The International Services Entity regime is a concept which is unique to Jersey. Having been in place for 3 years, I believe now is the right time to ask the business community to reflect on whether it has been successful and what, if any, changes should be made.

“We are also seeking to improve the structure of the fees charged while ensuring that ISEs are contributing the expected amount of revenue to States finances. Businesses' views on these matters will help shape the future of the ISE regime in a way which helps our financial services industry to compete and grow."

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