Tax: Exchange of Information Agreement between the Governments of Jersey and Japan

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A decision made 28 November 2011:

Decision Reference: MD-C-2011-0144
Decision Summary Title :	Signing of the agreement between the Government of Jersey and the Government of Japan for the exchange of information relating to tax matters.		Date of Decision Summary:	28 November 2011
Decision Summary Author:	International Affairs		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title :	Signing of the agreement between the Government of Jersey and the Government of Japan for the exchange of information relating to tax matters.		Date of Written Report:	28 November 2011
Written Report Author:	International Affairs		Written Report : Public or Exempt?	Public
Subject: Signing of the agreement between the Government of Jersey and the Government of Japan for the exchange of information relating to tax matters for the purpose of the prevention of fiscal evasion and the avoidance of double taxation with respect to taxes on the income of individuals.
Decision(s): The Chief Minister agreed to sign the Tax Information Exchange Agreement between the Government of Jersey and the Government of Japan.
Reason(s) for Decision: The signing of this Agreement is a continuation of the ongoing programme of signing tax information exchange agreements or double taxation agreements with all G20 and Organization for Economic Development and Cooperation (OECD) member countries. The Chief Minister is authorised to sign the Agreement in accordance with the provisions of Article 18(2) of the States of Jersey Law 2005 and paragraph 1.8.5 of the Strategic Plan 2006-2011 adopted by the States on 28 June 2006.
Resource Implications: There are no manpower or resource implications associated with this decision.
Action required: The Agreement will be signed and subsequently presented to the States for ratification.
Signature:		Position: Senator Ian Gorst, Chief Minister
Date Signed:		Date of Decision (If different from Date Signed):

Tax: Exchange of Information Agreement between the Governments of Jersey and Japan

Decision Summary

SIGNING OF THE AGREEMENT BETWEEN THE GOVERNMENT OF JERSEY AND THE GOVERNMENT OF JAPAN FOR THE EXCHANGE OF INFORMATION RELATING TO TAX MATTERS

Ministerial Decision Report

Purpose of Report

1. To recommend that the Chief Minister agrees to sign the tax information exchange agreement between the Government of Jersey and the Government of Japan.

Background

In February 2002, Jersey entered into a political commitment to support the Organization for Economic Cooperation and Development’s (OECD) tax initiative on transparency and information exchange through the negotiation of tax information exchange agreements to an agreed international standard.

Successive G20 Summits have encouraged jurisdictions to make progress in agreeing, implementing and abiding by the necessary international agreements for information exchange. In response, Jersey has maintained an active programme of negotiating agreements with G20, OECD and European Union (EU) member countries. This has served to enhance the Island’s international personality, and generally has helped to engender a more favourable view of the Island amongst the international community.

In September 2009, the Global Forum on Transparency and Information Exchange for Tax Purposes, a body of which more than one hundred jurisdictions are members, agreed a peer review process to assess compliance with the international standard. To oversee this process, a Peer Review Group was set up chaired by France, with four vice-chairs from India, Japan, Singapore and Jersey.

As a Vice-Chair of the Global Forum Peer Review Group, Jersey has led by example, and has attached particular importance to entering into agreements on tax information exchange with G20 and OECD countries. Jersey has now signed, initialled or completed negotiation with seventeen of the nineteen G20 countries (the other member of the G20 is the EU).

A total of 25 tax information exchange agreements (TIEAs) and two double taxation agreements (DTAs) have now been signed, of which 18 TIEAs and one DTA are in force.

The Agreement with the Government of Japan

Japan is both a member of the G20 and the OECD and the signing of this Agreement is a continuation of Jersey’s ongoing programme of signing tax information exchange agreements with G20 and OECD member countries.

Negotiations with the Government of Japan have produced a tax information exchange agreement that is consistent with agreements signed previously with other countries. However, a provision for the avoidance of double taxation with respect to taxes on the income of individuals is included within the Agreement, rather than as a separate Agreement as on previous occasions.

Procedure for Signing and Ratifying the TIEA

The Agreement with the Government of Japan is due to be signed by the Chief Minister on 2 December 2011, in accordance with the provisions of Article 18(2) of the States of Jersey Law 2005 and paragraph 1.8.5 of the Strategic Plan 2006-2011 adopted by the States on 28 June 2006. On 1 April 2010, the Council of Ministers agreed that the Chief Minister should proceed to sign tax information agreements or double taxation agreements with other G20 member countries without further recourse to the Council.

Following the signing stage, the Agreement will be presented to the States for ratification, following which it will be published and entered into the official record. In due course regulations will be made for the Agreement to enter into force when the domestic procedures of both parties have been completed.

The States, on 29 January 2008, adopted The Taxation (Exchange of Information with Third Countries (Jersey) Regulations 2008. The schedule to these Regulations lists the Third Countries, and includes the taxes covered by the agreements being entered into. As further agreements are entered into, the Regulations are amended to include in the schedule the jurisdiction and the taxes concerned. The necessary regulations to provide for the inclusion in the schedule of the Government of Japan and the relevant taxes will be presented to the States for adoption in due course subsequent to the signing and ratification of the Agreement.

Recommendation

The Chief Minister is recommended to agree to sign the aforementioned Agreement between the Government of Jersey and the Government of Japan.