'Too early to know' G7 tax agreement impact on Guernsey
IT is too early to know whether an ‘historic’ decision by G7 countries to back a global tax overhaul marks the end of Guernsey’s ‘zero-10’ corporate tax regime.
Deputy Gavin St Pier, a former president of the Policy & Resources committee, warned the ‘devil was in the detail’ after finance ministers from the G7 group of wealthy nations signed up to having a corporation tax rate of ‘at least 15%’.
Guernsey has a general zero corporate tax with a number of exceptions.
‘The devil, as it always is in tax, will be in the detail,’ said Deputy St Pier. ‘It’s aimed at this stage principally at large multinationals so it’s difficult to know whether it’s the end or just the beginning of the end for the zero-10 corporate regime we’ve had since 2008.’
It was also too early to try and detail the impact on the different components of the finance sector – as well as a case of continuing to ‘watch this space’ with more international discussions due in the days and weeks ahead.
‘As I’ve said many times before, Guernsey should have nothing to fear from a genuine level playing field. Let’s hope that what emerges from the detail,’ added Deputy St Pier.
British chancellor Rishi Sunak hailed the “historic” decision by G7 countries to agree a global base rate of corporation tax and reforms to the tax system aimed at targeting online tech giants.
UK officials also said the decision to agree a minimum corporation tax would create a ‘more level playing field for UK firms and cracking down on tax avoidance’.
