Treasury Minister Dr Alex Allinson MHK met colleagues from the other Crown Dependencies this week and agreed a joint approach to the OECD’s Pillar Two model rules for domestic implementation of 15% global minimum tax.
The meeting took place remotely with Ian Gorst, Jersey’s Minister for Treasury and Resources, and Deputy Mark Helyar, Guernsey’s Deputy Chief Minister and Treasury lead.
The statement reads:
‘The governments of Guernsey, Jersey and the Isle of Man ('the Islands') announce that they have reached a decision on a joint approach to the OECD’s Pillar Two framework, based on current international implementation of Pillar Two and discussions at the OECD. This decision ensures certainty for businesses in each of the three jurisdictions.
‘Our intention is that this approach will comprise the implementation of an 'Income Inclusion Rule' and a domestic minimum tax to provide for a 15% effective tax rate for large in-scope multinational enterprises, from 2025. The Islands will continue to work together, monitoring implementation internationally and adapt accordingly to developments which may require adjustments to our own implementation plans, and remain committed to continuing to offer attractive and globally competitive investment environments.
‘The Islands will continue to engage with diverse and widespread stakeholders – across a very broad range of sectors and geographies – to gather further information and to provide appropriate notice to allow businesses to prepare for these changes.
‘Our Islands have well-established and stable corporate income tax systems, and longstanding and independently assessed track records of meeting international standards. We are proud of our global leadership in tax cooperation, combatting money laundering and countering the financing of terrorism, and in providing appropriate and effective transparency.’
Minister Allinson said:
‘The Treasury has taken time to engage extensively with relevant businesses and stakeholders and is pleased to announce the joint approach for the Isle of Man alongside the other Crown Dependencies.
‘The Isle of Man, like Jersey and Guernsey, is well-placed to adopt these international tax reforms because of its existing corporate income tax system, but it is still important we allow enough time to ensure these planned changes are right first time.
‘Today’s announcement is intended to assist large multinational businesses with group turnover of more than €750 million in preparing for these changes. It also presents the opportunity to remind the majority of Isle of Man companies that the new rules will not apply to them and that they remain within the Island’s established 0/10% tax regime.’