A TWO-YEAR pilot investment in new technology could bring “transformational change” to Jersey’s finance industry, the Treasury Minister has said in his latest blog.
Firms which invest in technology that helps them to meet their regulatory obligations will be eligible for tax relief under the government’s proposed spending plans for 2024 and 2025.
If approved, the package of tax measures aims to boost business productivity by promoting investment in regulatory technology (‘regtech’) and remove tax barriers that create uncertainty and cost for businesses around staff mobility.
Jersey’s Chamber of Commerce previously questioned the lack of detail surrounding the plan’s allocation of £450,000 for tax incentives and wanted to understand whether the funds would be allocated to roll out regtech initiatives, which could have a significant impact on the Island’s financial sector.
Treasury Minister Ian Gorst has now published a blog explaining how the tax package could boost tech investment.
Deputy Gorst wrote: “Harnessing investment in technology will drive improvements in Jersey’s productivity and international competitiveness and it will help us make best use of our scarce human resources. There is huge potential for the Island waiting to be grasped.”
He continued: “At a time when staff in Jersey are in huge demand for risk and compliance roles in this sector, the accelerated adoption of regulatory technology has the capacity to bring transformational change. Firms of all sizes will be able to work with service providers to speed up client onboarding using digital technology.
“This will deliver more efficient processes and enable staff and other scarce internal resources to be focused on more targeted monitoring of risk and higher value-added roles.
“The targeting of resources in this way should bring economic benefit, not only to the firms themselves, but more broadly across the Island’s economy.”
Explaining the pilot, Deputy Gorst explained: “It will cover expenditure on hardware, software and training related to regtech and is uniquely designed for entities regulated by the Jersey Financial Services Commission – a sector of the economy that pays corporate income tax.”
Regulatory technology, or regtech, is an emerging technology that involves using digital tools and processes that improve the way organisations manage their increasing regulatory compliance commitments.