Finance (2015 Budget) (Jersey) Law 201- (P.141/2014)

Information about the publication of Ministerial Decisions

A formal published “Ministerial Decision” is required as a record of the decision of a Minister (or an Assistant Minister where they have delegated authority) as they exercise their responsibilities and powers.

Ministers are elected by the States Assembly and have legal responsibilities and powers as “corporation sole” under the States of Jersey Law 2005 by virtue of their office and in their areas of responsibility, including entering into agreements, and under any legislation conferring on them powers.

An accurate record of “Ministerial Decisions” is vital to effective governance, including:

demonstrating that good governance, and clear lines of accountability and authority, are in place around decisions-making – including the reasons and basis on which a decision is made, and the action required to implement a decision
providing a record of decisions and actions that will be available for examination by States Members, and Panels and Committees of the States Assembly; the public, organisations, and the media; and as a historical record and point of reference for the conduct of public affairs

Ministers are individually accountable to the States Assembly, including for the actions of the departments and agencies which discharge their responsibilities.

The Freedom of Information Law (Jersey) Law 2011 is used as a guide when determining what information is be published. While there is a presumption toward publication to support of transparency and accountability, detailed information may not be published if, for example, it would constitute a breach of data protection, or disclosure would prejudice commercial interest.

A decision made 4 August 2014:

Decision Reference: MD-TR-2014-0088
Decision Summary Title:	2015 Budget – enacting Legislation		Date of Decision Summary:	04 August 2014
Decision Summary Author:	Acting Deputy Comptroller of Taxes		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	2015 Budget – enacting Legislation in respect of the draft 2015 Budget proposals		Date of Written Report:	04 August 2014
Written Report Author:	Acting Deputy Comptroller of Taxes		Written Report : Public or Exempt?	Public
Subject: 2015 Budget – Enacting Legislation in respect of the draft 2015 Budget proposals.
Decision(s): The Minister approved the lodging of the Finance (2015 Budget) (Jersey) Law 201- enacting legislation in respect of the Minister’s Draft 2015 Budget proposal. The Minister further decided to lodge an Act of Declaration so that the legislation may have immediate effect.
Reason(s) for Decision: The draft 2015 Budget enacting Legislation is to be lodged “au Greffe” at least 6 weeks prior to debate on 22 September as required by the Public Finances (Jersey) Law 2005.
Resource Implications: The financial and manpower implications are identified at section 6 of the report “2015 Budget – enacting Legislation to support the proposals in the Draft 2015 Budget Statement”.
Action required: The Greffier of the States is requested to lodge ‘au Greffe’ the draft Budget Legislation with a request for debate on 22 September 2014.
Signature:		Position: Senator P F C Ozouf, Minister for Treasury and Resources
Date Signed:		Date of Decision:

Finance (2015 Budget) (Jersey) Law 201- (P.141/2014)

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Treasury and Resources

Ministerial Decision Report

2015 Budget – enacting legislation IN RESPECT of the DRAFT 2015 BUDGET PROPOSALS

Purpose of Report

The purpose of this report is to enable the Minister to lodge the Finance (2015 Budget) (Jersey) Law 201- enacting legislation in respect of the Minister’s Draft 2015 Budget proposals.

Background

The legislation supports the 2015 Budget proposition and the proposals contained within the draft 2015 Budget Statement.

Proposals

A summary of the proposed measures to which the enacting legislation relate are listed below:

Income Tax Proposals

All changes come into effect for year of assessment 2015.

The Minister proposes the following.

Exemption thresholds

The income tax exemption thresholds for the year of assessment 2015 shall increased by 1.7% in line with the increase in inflation to 31 March 2014.

Allowances

The allowances will remain at the same level as in 2014.

Cap Mortgage Interest Tax Relief

The Income Tax Law is amended to provide that the amount of Mortgage Interest Tax Relief that can be claimed in respect of a taxpayer’s only or main residence is capped at £15,000.

Income Tax Instalment System (ITIS) –taxpayers put on a current year basis upon returning to the Island

The Income Tax Law is amended such that a returning taxpayer, provided he/she has been non-tax resident in the Island for at least one year, pays their tax through ITIS on a current year as opposed to previous year basis.

Double Tax Credit

The Income Tax Law is amended so that marginal rate taxpayers will become entitled to double tax credits where Double Tax Agreements are in place.

Companies supplying Hydrocarbon Oil

The Income Tax Law is amended to ensure that companies that supply hydrocarbon oil (except those companies which only supply hydrocarbon oil through forecourt operations) pay tax at 20% on all of their profits generated from this activity.

Pensions and Pension Schemes

Income Tax (Amendment No. 44) (Jersey) Law 201-, which makes the legislative changes required to introduce the new rules applying to pensions and pension schemes, is being lodged alongside the 2015 Budget and is subject to a separate Decision Summary and Written Report.

Goods and Services Tax Proposals

Credit for, or repayment of, overstated or overpaid GST

The Goods and Services Tax Law is amended to shorten the period within which refunds of overpaid GST can be claimed from the Comptroller.

Impôts Duty Proposals

Increase the duty on alcohol, tobacco, fuel and VED by the following:

Spirits – 1.7% - an increase of 21.7p per litre
Wines – 1.7 % - an increase of 2.4p per 75cl bottle
Strong beer – 1.7% - an increase of 1p per pint
Weak cider – 6.9% - an increase of 1.1p per pint
Standard cider – 6.9% - an increase of 2.2p per pint
Strong cider – 8.7% - an increase of 4.6p per pint
Tobacco – 4.7% - an increase of 22.4p on 20 king size cigarettes
Fuel – 2.2% - an increase of 1p per litre
Vehicle emission duty bands - a 1.7% increase

Stamp Duty and Land Transaction Tax Proposals (LTT)

First time buyers

To note that the temporary threshold of £450,000 for determining entitlement to reduced rates of Stamp Duty/Land Transactions Tax is not extended beyond 31 December 2014, whereupon the threshold will revert to £400,000.

Stamp Duty/LTT on Secured Debts

The Stamp Duty and Land Transactions Tax Laws are amended to reduce rates/tax on securing mortgages on Jersey residential property costing no more than £400,000.

Stamp Duty/LTT on Expensive Properties

The Stamp Duty and Land Transactions Tax Laws are amended to increase rates/tax for all (residential and commercial) properties costing more than £1m.

Stamp Duty – Fair Rates of Duty on Devising of Immovable Property

The Stamp Duty Law is amended to enable fair rates of duty to apply where an application to register Probate is received from a charity but where there are individual heirs to the Estate in addition to the charity itself.

Recommendation

It is recommended that the Minister for Treasury and Resources approves the 2015 Budget enacting legislation together with the European Court of Human Rights Statements and that the legislation be lodged au Greffe to allow the 2015 Budget proposition to be debated by the States at the sitting of 22 September 2014.

It is also recommended that the Minister request that an Act of Declaration is lodged so that the legislation may have immediate effect.

Reason for Decision

The 2015 Budget enacting Legislation is to be lodged “au Greffe” at least 6 weeks prior to debate on 22 September 2014 as required by the Public Finances (Jersey) Law 2005.

Resource Implications

The proposals within the Draft 2015 Budget Statement will be implemented without any increase to current approved staffing levels.

The financial implications of the Budget proposals in 2015 would be an increase to States revenues of £962,000 compared to the forecast from the 2014 Budget with the impact of the income tax measures which relate to income tax year of assessment 2015 not impacting on States revenues until the financial year 2016 when the financial implications are estimated to be an increase of £2,662,000.

Report author : Acting Deputy Comptroller of Taxes	Document date : 05/08/2014
Quality Assurance / Review : Business Manager	File name and path: L:\Treasury\Sections\Corporate Finance\Ministerial Decisions\DSs, WRs and SDs\2014-0088 - tax legislation\WR re Budget 2015 enacting legislation - Draft 1 29 July 2014.docx
MD sponsor : Treasurer of the States