TAX arrangements for those who live and work in different jurisdictions are being reviewed by the government in a bid to achieve greater clarity.
During a Scrutiny hearing with External Relations Minister Ian Gorst, a leading Tax Office official outlined potential adjustments to tax policy that could be introduced in response to changes in working patterns in recent years.
Deputy comptroller of revenue Cora O’Brien told members of the Economic and International Affairs Panel about work forming part of the goal of making Jersey more competitive.
“We are looking at the taxation of cross-border, movements of people in and out of Jersey, and we are looking at ways in which we can reduce barriers that might exist, or frictions in the system, where people might be working from a home office or a base here, while also being employed by somebody elsewhere,” she said.
“A big part of that is a review we are doing on the personal income tax residence regime – we have a goal of having a much more black-and-white test for people, commencing in January 2028, that will bring a lot more certainty and help to that area of work.”
Panel chair Deputy Montfort Tadier said he was interested in the scope for changes that would allow for flexible working.
“People are not necessarily based in one jurisdiction or another – they could live somewhere, work somewhere else, and maybe the question of where they pay tax could be decided with reference to a dual-taxation agreement,” he said.
Ms O’Brien said the focus on this area in Jersey matched what was happening internationally, with the Organisation for Economic Co-operation and Development expected to issue guidance on cross-border working and working from home.
Consideration would also be given to residency rules, she explained, looking at how talented individuals could be brought to Jersey, as well as making it easier for Island businesses to have people working temporarily abroad to gain experience and bring it back.
A consultation is set to be carried out later this year.
Ms O’Brien added: “We have some concrete ideas about how we should change it, and we will be putting that out for for wider discussion, because obviously it affects all industries and all people across the Island and and different groups have got different priorities – that [consultation] is definitely something you will see within the next six to nine months.”
The discussion was initiated through questions on double-taxation agreements posed by panel member Deputy Beatriz Porée in the wake of the recently-signed agreement between Jersey and Bahrain.
Asked about whether other such treaties may follow, Deputy Gorst said that there was the prospect of a DTA with Romania, and that there had also been interaction with Portugal about greater cooperation over taxation issues, although he stressed that the Portuguese discussions were at a very early stage.
