The governments of Jersey, Guernsey and the Isle of Man are asking businesses for their views on proposed new legislation that will require certain tax-resident companies to demonstrate they have sufficient substance.
The legislation is aimed at avoiding a blacklisting by the European Union as uncooperative in tax matters.
Like the Cayman Islands, all three jurisdictions have been accused of violating the EU’s fair tax criterion, which stipulates that jurisdictions should not facilitate offshore structures that attract profits without real economic activity.
And like the Crown Dependencies, Cayman committed in November 2017 to address the perceived lack of tax fairness before the end of this year. To this end, the ministry of financial services said it had formed several working groups to review the EU’s guidance paper and provide input into legislative proposals to address the economic substance requirements.