CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Jersey Launches Property Tax Review

Jersey Launches Property Tax Review

by Jason Gorringe, Tax-News.com, London

26 October 2012


Jersey has begun a substantial review of land and property taxation after the government decided to abandon plans to target foreign-owned non-finance companies with a new levy.

The announcement comes after the publication of two reports, the most recent of which was prepared by the island's finance minister, Phillip Ozouf, examining measures to boost the contribution of non-resident non-finance companies, which benefit from a 0% corporate tax rate.

A number of measures were considered in the reports, including:

  • Extending the 10% and 20% corporate tax bands;
  • A payroll charge or a charge based on property size;
  • A deemed rental (so-called “Blampied”) tax;
  • Restricting input GST recovery; or,
  • Introducing a form of community charge.

The government has now ruled out imposing one of the aforementioned measures, with Ozouf stating that it had been come evident that there is "no perfect solution", and that "all the options would create new problems".

"Extending the 10% or 20% band risks compromising compliance with the EU Code of Conduct [on business taxation], which in its turn could jeopardize tax neutrality, the mainstay of our financial services industry. Some of the potential charges reviewed also run the same risk. And charging a specific sector would add to the cost of doing business, leading to increased prices and the stifling of economic growth," he said.

Instead, the government has confirmed that: "When the economic conditions recover... it may be appropriate to introduce changes to the way property is taxed in the island.

The government said that a "substantial review of land and property taxation as a whole has begun," and that some changes may be proposed in the 2014 Budget next year.

Noting that the burden of property and land taxes is comparatively low in Jersey, Ozouf said that, "more work can be done on property taxes, including tightening the rules so that non-residents pay the tax we expect on income from commercial property in Jersey. Property tax is an efficient way of raising revenues and I intend to make sure such investors pay the right amount of tax."

On the contribution of foreign-owned non-finance companies, Ozouf concluded: “We will continue to work with the other Crown Dependencies, who are facing the same issue, and we will watch international developments to see if we can make changes in the future which are currently not possible.”

TAGS: tax | business | property tax | international financial centres (IFC) | Jersey | payroll | offshore | multinationals

To see today's news, click here.

 















Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »



Stay Updated

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.


To manage your mailing list preferences, please click here »