The proposal has been lodged in response to a review by the EU Code of Conduct Group, a Brussels-based body which found that part of Jersey’s zero-ten corporate tax regime was harmful.
The concern centred on the deemed distribution and attribution provisions, which tax Islanders who are in receipt of benefits, such as shares, arising from company profits.
However, no such rule applies to non-resident shareholders of Jersey-registered companies who therefore pay no tax on those benefits, which the group found harmful because the tax discriminated between the two types of shareholders.
Treasury Minister Philip Ozouf has now lodged a proposition to remove these elements of the tax regime, which will reduce the States’ tax intake by up to £10 million per year from 2013/14.
