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Maclean planning to tax UK firms currently paying nothing

Maclean planning to tax UK firms currently paying nothing

Friday 13 November 2015

Maclean planning to tax UK firms currently paying nothing


A “Tesco Tax” to claw back some money from foreign businesses in Jersey is being considered, the Treasury Minister told a public meeting last night.

The tax, which is running in the Isle of Man and which has just been agreed in Guernsey, is based on a charge calculated on profits earned by retailers.

If it works, the tax would solve one of the biggest problems with the “Zero-Ten” company tax system, which allows foreign-owned non-finance firms to pay no tax at all to the States.

Because “Zero-Ten” only taxes local shareholders on company profits, companies such as Normans, de Gruchy and BhS don’t pay any company tax here – although they do pay Social Security contributions, and the States take tax from their employees.

The “Tesco Tax” proposal in the Isle of Man – named after the supermarket group because it’s the largest non-local business operating there – is levied on major retailers with annual profits of more than £500,000, and has been assessed and approved by the EU Code Group that reviews tax fairness.

Estimates for how much it might raise go up to £3.5 million.

In Guernsey, the estimate is for up to £2 million in revenue per year.

The charge hits both locally and non-locally owned companies – but the vast majority of retailers making big profits in Jersey are UK-owned.

During last night’s Any Questions meeting organised by change.je, Treasury Minister Alan Maclean said that they were at the early stages of considering if a charge could work, and if it would satisfy the EU rules that led to the adoption of “Zero-Ten” in the first place.

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Senator Maclean told the meeting of around 60 people that work was being carried out to see if the tax could work.

He said: “Where shareholder profits go off-Island, we retain the tax on employees but the shareholders who don’t live here pay tax in their own jurisdiction.

“From our point of view, to be able to consider a tax of that nature – which would not just be for retailers – we have got to ensure that it’s ‘Code Compliant’.

“I’m not sure that Guernsey has got that data, but we are trying to collate it.” 

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Posted by david forde on
Especially those who charge UK VAT!! Should never have been allowed in the 1st place!
Posted by The old git Git on
About time too.
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