On 24 February 2012, Treasury Minister Eddie Teare, MHK, made clear that the Isle of Man Government has no intention of introducing a capital gains tax following the abolition of the attribution regime for individuals (ARI).
The Treasury Minister had, however, also made it clear in his budget speech delivered on 21 February 2012 that the revenue due to the Treasury must be protected. Since that date, professional bodies in the Isle of Man have been working with the Assessor of Income Tax through a body known as the Tax Liaison Committee in order to assist the Treasury to identify any areas in Manx tax law and practice which remain unclear in relation to the taxation of corporate distributions.
The Treasury Minister said today (4 April 2012),
“The close and reciprocal liaison between the private sector and Government in the Isle of Man is one of our great strengths, and I believe that it contributes directly to our competitive offering as a financial services centre.” He went on to say, “I understand that this recent liaison work has highlighted some areas where more clarity is needed, and the key now is to move forward quickly and professionally to a point where current and potential future investors and their advisers have reassurance regarding how company distributions will be taxed in various situations.”
ARI is being abolished with effect from 6 April 2012. Practice Note 174/12 (Removal of Concessions – Distributions) issued by the Assessor on budget day will be superseded by updated guidance resulting from Treasury’s consideration of the work of the Tax Liaison Committee, and a decision has been taken to remove it from the Income Tax Division’s website pending the publication of that updated guidance.
Any specific enquiries should be referred to the Income Tax Division.