New Regulations on EU Savings Tax

The Council of Ministers is to ask the States of Jersey to make regulations that will make it mandatory, from 1 January 2015, for Jersey to automatically exchange tax information for EU Savings Tax Agreements. The regulations will repeal the present retention tax provisions for the Savings Tax Agreements that were entered into in 2005 with the Member States of the European Union.

 

The regulations will also enable those who wish to do so to change over to the automatic exchange of information in advance of it becoming mandatory. This option has been included in response to the wishes of those financial institutions in Jersey that have offices in Guernsey and the Isle of Man and who wish to harmonise their systems at the earliest possible date.

 

The Chief Minister, Senator Ian Gorst, said “We have been waiting for the position of the European Union to be clarified. Having regard for the outcome of the European Union Council meeting in June this year, and the call of the G20 Finance Ministers at their meeting in July on all jurisdictions to commit to automatic exchange of information, we consider this is now the right time to announce the proposed change from the retention tax. Also of relevance is that, with the increase in the retention tax rate to 35% in July 2012, a significant majority of those subject to the tax have already taken advantage of the voluntary disclosure option in the agreements.”

 

EU Tax Commissioner Semeta said “Automatic exchange of information has long been a cornerstone in the EU's fight against tax evasion and is now set to become the international standard. It is the best way of ensuring that every country can collect the revenues it is rightfully due. I welcome Jersey's decision to join the global move towards more openness and greater information exchange. This will help facilitate fairer and more effective taxation, in Europe and globally."