Scrutiny to review proposed new tax regime for Jersey
29th August 2024
A Scrutiny Panel is to review the proposed changes to Jersey's tax regime by the adoption of the Organisation for Economic Cooperation and Development's (OECD) Pillar 2 initiative. A key part of the OECD initiative is to address the challenges of the global digital economy. The Scrutiny review will consider how the Government of Jersey's proposed approach to implementing these new standards will impact the Island's financial competitiveness compared to other jurisdictions, as well as the impact on those targeted businesses based in the Island. It will also evaluate the long-term sustainability and risks of the proposals.
The Pillar 2 initiative aims to establish a global minimum tax rate on the profits of multinational enterprises above a certain threshold, regardless of where they are headquartered or operate. It is hoped that Jersey's implementation of Pillar 2 will prevent these businesses from shifting to low or no-tax jurisdictions, so that all countries can collect a fair share of tax revenues. The minimum tax rate will be 15%.
The Panel, chaired by Deputy Jonathan Renouf, is a sub-panel of the Corporate Services Scrutiny Panel. It also includes: Deputy Montfort Tadier, Deputy Max Andrews, Deputy Hilary Jeune, and Constable David Johnson. The Panel has already received several briefings on Pillar 2 and will be holding a public hearing with the Minister for External Relations and the Minister for Treasury and Resources. The Panel is keen to hear from those who will be affected by the tax changes.
Chair of the Panel, Deputy Jonathan Renouf, said: 'The OECD Pillar 2 initiative is a significant international tax reform which will have global implications for international tax policy and corporate tax strategies. It will require significant changes to Jersey's regulatory framework and tax policies, but it's hoped it will enhance our competitiveness and reputation as a transparent international finance centre. We as a Panel want to ensure that this initiative is introduced in a way that works for Jersey's benefit.'
For further information about the Review and to make submissions, visit: Scrutiny review (gov.je) Queries can be sent to: scrutiny@gov.je
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