States change rules to attract more super-rich
Saturday 23rd July 2011, 2:59PM BST.
The proposition was put forward by Treasury Minister Philip Ozouf
SUPER-rich immigrants are to be lured to Jersey with the promise of new lower tax rates.
The States approved by 35 votes to ten a new tax package for would-be 1(1)ks to encourage more to bring their fortunes to the Island.
During the debate, wealthy immigrants were praised for the contribution they make to the Island.
At the moment, many 1(1)ks keep significant parts of their income outside of Jersey and therefore do not pay tax on that money in the Island.
It is hoped that the new rules will encourage them to keep more of their wealth in Jersey because they would pay a lower tax rate on it.
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Roll up, roll up, tax dodgers come right this way, you don’t have to pay tax on the money you don’t need and will never spend because the locals have picked up the slack for you.
You’ll be doing the island a favour by bypassing the local qualifying period and moving straight into a 11K mansion, hell you might even employ a couple of locals to take out your garbage.
Meantime back on earth, GST has increased, social security is about to and many locals have taken 2nd jobs just to feed the their kids.
A fair and equal society, that’s what we don’t want.
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In this instance I agree with Senator Ozouf.
Why have 5000 immigrants all claiming benefit of some kind and contributing no tax to the island because they are on low wages when you can have 15 people paying their way and contributing financially and socially to Jersey.
The thousands that are arriving every year in the island are not contributing to the island as they are for the most part on low incomes, work in the hospitality industry and are unqualified status.
This should have been done years ago if only to stop the rampant immigration that is now ruining the island.
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We all know the 1(1)ks engage in tax avoidance, that is why they are 1(1)ks, no doubt to the same extent as the Jersey Treasury seeks to levy tax. A fiscal standoff which will remain until we engage in some smart thinking.
Why not make the 1(1)k status time limited, say 5 years, with renewal conditional on the amount of tax that was actually paid in the proceeding five years? There will no doubt be other potential 1(1)ks seek authority to come to Jersey who could be granted entry as existing 1(1)ks fall of the roll, either because they have died or because their tax contribution had fallen below par.
Or put bluntly, make the 1(1)ks compete to keep their 1(1)k status!
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I still cannot see how allowing 1.1k’s to pay 1% tax while owning businesses competing in Jersey with Jersey businesses whose owners must pa 20% is anything other than extreme discrimination and obsequious pandering to non-locals.
I for one will bang on about this at every opportunity and every political level because it is so DISGUSTING !
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I forgot to add in my red-mist rant on this ,that if Jersey is to get an anti-discrimination law in the near future, how on earth can this absolute discrimination…namely a tax based on race .. that non-jersey residents if they are rich enough pay less tax than Jersey residents following the same occupation in the same place..Jersey.
Joined up sinking!!!!
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This is a wise decision by the States. Although they must remember to plough the extra income into the hospital and good health care for Jersey.
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This is so nauseating. Ozouf is pimping jersey to tax exile parasites and makes grovelling, sycophantic noises at the same time. Make no mistake, he doesn’t speak for me nor, I imagine for a majority of proper, Jersey born people (not “islanders”).
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Not being funny – but as a local who may have started earning this sort of money – should I not get the same rates too?
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What would be interesting to see is how much money Jersey has lost to immigrant workers sending the money home, in the Uk in the last 7 years 26 Billion pounds earned by immigrants they send home, Why can’t my Jersey passport let me work in Europe and maybe start a new life, I mean they are after all flooding in and taking everything we locals work for.
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Claude your post is not related to the topic.
I don’t think you’ll find your Jersey passport hampers you in any way and, if like the immigrants you mention, if you had the nonce to do so, you could start a new life wherever you wanted to instead of sitting here moaning and begrudging people who have got up and done something.
Remember, it is immigrants who have built YOUR JERSEY
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Claude your post is not related to the topic.
I don’t think you’ll find your Jersey passport hampers you in any way and, if like the immigrants you mention, if you had the nonce to do so, you could start a new life wherever you wanted to instead of sitting here moaning and begrudging people who have got up and done something.
Remember, it is immigrants who have built YOUR JERSEY. Also, remember most immigrants have been used and abused by YOUR JERSEY
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2.
Why are thousands arriving every year as you say when 1,500 are unemployed.
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Since when have the rich paid their way with tax , they are rich for a good reason , because they can afford to pay a good accountant to help them avoid paying anything that they can avoid., Only the working classes pay through the nose for everything , it might bring in some money but it does not make it honest
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No10 Jon I can only assume that you are not local nor hold a Jersey passport.
If you where Jersey born and had a real jersey passport and read the restrictions it clearly states that the passport holder has no rights to work or benefits in the EU.
An English passport allows you to work in EU.
Also I’m jersey born and worked all my life. I pay over the top rent I pay over the top in tax and social security so others like the fat cat spongers can benefit, so don’t preach to me about sitting here moaning, I’m within my rights to voice my opinions.
moaning
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This is good, it gives balance, and at the same time the JDA and associated lefties can table their proposals on tax and benefits to continue to attract the super poor.
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Hi Jon @10,
I think Claude is referring to the stamp in some of our passports stating:
NO RIGHT TO WORK OR CLAIM BENEFITS IN THE EU
or similar.
Claude is forgivably off thread but in my opinion has every right to be pi**ed off with the EU and our governments (UK & Jersey).
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To paraphrase one of the world’s leading researchers of psychopathy, “psychopaths have hardly any difficulty infiltrating business, government, politics, law enforcement,…” Certainly the first of those is likely to cover any incoming 1.1ks.
So, apart form the super-rich that have inherited their riches (and possible some genetic make-up also), just who are we inviting do Jersey? And do we really want such people here?
Surely the current headlines around the world make it clear just how those at ‘the top’ actually got there. Isn’t it time the rest of us (the ones that have morals) were paid back for not trodding on others to get our own way!
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#8 YES, you should. If the States don’t allow you to do so then move your money elsewhere and make them suffer for it.
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There are many negatives to 11k’s.Ozoufs statements are blatant lies and rather infantile.
There are many individuals and businesses who suffered at the hands of 11k’s forcing them out of business with their aggresive business tactics and its still going on.Expect to see more local companies going under.
Then there is housing.While the average islander may not be able to afford a million pound property if there wern’t so many 11ks then that property wouldn’t be worth a million and local families might actual be able to buy a property with the luxury of a garden!
And remember a 11k is not just one person,its his whole family plus maid gardners,etc.I recently worked on a 11k house and the whole entourage amounted to around 8 people.What qualificatins do these people have?Can they buy a property.How do they get a work permit.J-cat for being a maid?Is there a limit on how many properties a 11k can buy?
And as for spending,sure they buy food when they are here in the summer,but i bet most of their clothing is bought in London,Paris etc.
And what if they are big and powerful like the Barclay brothers in Brechou,when they dont get what they want politically they shut down the local businesses they own.Is there any reason why that couldn’t happen here?
I find it strange that the report into 11ks was only available to the Council of Ministers,why not make the full report available to all states members.I think the results might have been different if they had.
While there are certainly pros to having 11ks there are also negatives,its seems Ozouf is afraid to have this debate as he can only see it in monetary terms and not the effect it will have on our society.
Personally i think 11ks don’t pay enough tax and i am against any more coming here pushing everyone else into housing poverty.I am sure they wouldn’t mind paying a bit more tax remember ’20 means 20′ and if they are that concerned about paying taxes they can go and live in Dubai where income tax is zero.
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The 1(1)K’s have actually been bad for the island as they don’t actually bring any money/trade etc. into the island in sufficient amounts to justify their presence.
If the original 0-10 was not EU compliant then, surely, 1-20 cannot be.
A complaint to the European Court of Human Rights should be considered.
Anyone with the appropriate know-how prepared to proceed?
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After 5 years an immigrant with 2 children, working for minimum wage, can claim £17,000 in income support. It will cost the taxpayer £16,000 per annum to educate their children at secondary level. They will pay no tax. The cost over ten years will be £330,000 with no money back (as they don’t pay income tax and will get a GST refund). The policy of attracting low paid workers – and subsidizing the hotel and retail industries by allowing low wages to be paid – mean that a wealthy immigrant that actually pays tax is better than a low paid immigrant that costs a fortune. This is not a racist comment, it is merely the reality of the Income Support system. The JDA should be attacking the immigration that costs the Island a fortune, and steals local jobs, not 11K’s that pay their way. Pitmans and Southern don’t appear to be very bright.
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The COM and states have now set a very dangerous precedent and as always I suspect they have not taken legal advice on this matter.
Twenty means Twenty and ITIS can no longer be enforced if the select/elite have the ability to negotiate a specific tax rate as this breaches EU human rights if not available to all – unless you are in a position of default.
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The more I think this through the more ludicrous the entire idea is.This is nothing but an argument that all should be taxed in an equal fashion in equal circumstances ..clearly that is not the case here, it is massively skewed to give advantage to the wealthy with the ‘normal’ Jersey resident inevitably picking up the shortfall at some juncture.
Doomed Distribution!
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what does 1.1k’s stand for
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Reality Cheque (21) Twenty means Twenty and ITIS can no longer be enforced if the select/elite have the ability to negotiate a specific tax rate as this breaches EU human rights if not available to all – unless you are in a position of default.
Nice one. We should all have equal rights to negotiate our tax rate based on our worth to the island! If the 1(1)k is having a heart attack surly the paramedic should be allowed to assess the situation and impose favourable terms!
Yes Reality 20 means 20 should apply to us all; tall or short; fat or thin; black or white; rich or poor.
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So long as all you mugs who live and work here realise you are now paying 38% TAX yes that;’s right 38%..!! add your social to your income tax add 5%GST….on and o0n…and we are a Tax free port by Royal decree….it’s all….B*****it
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THink of the contribution one 11k resident can make, £125k p.a I believe it is…
If 1 resident can contribute an amount equal to the contribution of 10,000 then why not? Also, they will have shops, use taxi’s, restraunts, builders, cleaners etc.. So they are actually boosting our economy. I can imagine there are plenty of downsides like the fact that us true bloody locals are being robbed of, well me personally, 15% tax!!! But then again you can’t stop/beat/change anything as any suggestion will fall onto deaf ears.
I think the person who mentioned a 5 year rule/review point is correct.
The States should also look at (as mentioned by #20) the other end of the scale, why let people in if they are just going to cost money?? That is just stupid.
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This would certainly be a reasonable thing to suggest doing, if we were not in the process of implementing ’20 means 20′. ’20 means 20′ was sold as a way of ensuring that the very rich paid their fair whack, but apparently it doesn’t mean that. If it’s not reasonable to expect the very rich to pay income tax at 20%, why it it reasoanable to expect lesser mortals to do the same? 20% of, say, £1m is a lot, but it still leaves you £800k to get by on – much more than these people would have left if they lived in the UK.
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I would like to see some facts to how much 1-1k’s benefit this island. Terry Le Main I Notice ,gave his two-penance worth by thanking them for the enormous contribution they make to the economy. But how much do they? I do not think there are many ( if any ) are like Mr Kirsh for example. The whole economy in Jersey is skewed by the finance industry, making property values totally unrealistic – so much so that property is very hard to come by if locals are not employed by the industry. This cannot be right- Locals leaving Jersey because they have no chance of buying a house and raising a family. I think there should not be special tax arrangments for the rich- they should pay the same tax as us lower paid, local people. And that should apply to all these UK shops as well!
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Hmmm me thinks the SOJ should see an accountant! Haha
If another jurisdiction is charging 0% then why would a 1% tax rate be an incentive? They are not going to redistribute their wealth, that actually takes effort and 1% on a million is still £10,000 more than £0.
You forget they just follow the advice of their accountant, their accountant will advise them to keep things as they are and you will actually take less tax on what they would have brought to Jersey anyway!
Is it me or do SOJ seem to discuss the most random half baked ideas!
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reality cheque(21), please explain”the position of default” to a luddite like myself .
correct me if i am wrong, 0 -10 was booted out as it was unfair to local business.
so the rest of it must be un fair as it affects the people who are holders of european passports and have the right of abode in europe.
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Is not the difference in 1.1.k’s tax treatment in that they pay a fee of minimum £125,000 regardelsss of income, whereas the workers, and that includes me pay 20% on our income.
What is often overlooked is that the UK, to some is regarded as a bit of a tax haven to UK Res / Non Doms, who park their ‘wealth’ in a Jersey trust which is managed by tax paying Jersey workers, and then elect for ‘Remittance Protection’ which only costs £30,000 per annum (to be increased to £50,000)
So a 1.1k living in Jersey paying £125,000 per annum is good for the island. If you really think that you will get 1.1k’s paying 20% on their world wide income, you have not got a hope in hell.
There is a fundemental difference between wealth and income, and Jersey’s tax system concentrates on income rather than wealth. If I had won the recent Euro lottery of €165m I could have remained in Jersey, placed the money in a current account, and paid NO TAX, because I would have no income to tax !!!!!
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We can’t do a ‘Tea Party’ because the phrase ‘No taxation without representation’ doesn’t apply here because our ‘representatives’ have shafted us ,royally.
Perhaps ‘L’etat est moi!’ is more appropriate ,I don’t think that ended well if memory suits me well. Can’t see Victor Hugo writing a book about Senator Ozouf though.
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29 small money – position of default- basically unable to pay any back taxes and have to increase ITIS over the 20% or pay on as and when…
The tax collectors are already going through their back catalogue finding pennies to claim.
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Translated, the headline means:
“States makes up the law as it goes along (and disregards existing law in a wholly unlawful way) to suck up to tax exiles and to fiscally discriminate against local people and prejudice the respective economies which are deprived of the avoided tax”.
How about a degree in translating ozouf spin-babble?
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“Is not the difference in 1.1.k’s tax treatment in that they pay a fee of minimum £125,000 regardless of income, whereas the workers, and that includes me pay 20% on our income.”
That is not true.
There are many older 1.1(k)’s that pay a lot less than that and even a few that are living in what could be best described as genteel poverty.
The whole issue of 1.1(k)’s is clouded by the understandable need to protect the privacy of the individuals concerned but there is also a fair amount of spin and misinformation as well.
The bulk of island taxes is paid by middle Jersey via payroll, GST and duties on fuel and excise goods, the loss of exemptions and reliefs under 20 means 20 has raised this proportion.
Very little is paid by the poor or the really seriously well off and the proportion paid by companies has fallen due to 0 – 10.
Jersey is still a good place for middle class professionals to live and work but Senator Ozouf and his chums in the States and business are gradually eroding it’s attractiveness.
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#19 John, don’t be silly, successful businessmen are all good people, they’re all incredibly smart and value humankind, that’s how they got where they are, they EARNED that money!
And if you think I’m not being sarcastic see post #17. Indeed these people tend to have lots of friends, moreso maybe than you and I, and it doesn’t say anything about them that so many of their friends are actually just business associates.
Thankfully you have your head firmly screwed on. Too many people in our society still believe that people in the upper echelons of business got where they are purely on hard work and intelligence, therefore they earned their money (but we are only worth the pittance we get paid of course, we haven’t earned any more). You would think the recent, very public showings up of the free market and those who benefitted most from it would cause people to think “maybe I got it wrong”, but some people still think the likes of the Trump, the Murdochs, Alan Sugar etc got to the top purely on hard work and intelligence
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Actually, doesn’t it tell you how stupid these people really can be that they invested so poorly they have been financially bailed out by Irish children (including ones that haven’t even been born yet!) They invest well enough (luck and the benefit of some handy contacts I suspect) to reap the financial benefits, but when the good and mighty get it wrong (i.e. luck runs out) somehow it’s our fault and they get our money to fix it. Weird, very weird.
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So Warren it appears to me that what you are saying is that offshore workers benefit at the expensive of the UK taxpayer who is left to cough up the amount lost by using an offshore finance centre via extra taxation.
Pip valid points. Some pay a darn sight less than many workers are expected to pay.
Leah the myth that hardwork is a guarentee to making you rich still prevails today, you would have thought people would have seen through this by now.
One report I read recently says that for every 100 people of retirement age 1 will be rich, 4 will be very well off and the rest will either be getting by or in relative poverty.
This means according to some on here (who think that hardwork brings success and that if you don’t get on you must be lazy) that 95% are lazy…..
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reality cheque(34).
many thanks for the explanation.
i know someone in this position.
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#34 To add to that, I would advise absolutely everyone who pays tax to work out for themselves what they should be on, the Tax Office don’t have a clue what they are doing when deciding what rate you should be on! Work it out yourself and send them a letter with your own calculations.
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Just very sad Jersey wants to attract the super-rich…never talks about attracting the super-clever? Or the super-culturally-educated?
It is kinda’ Dubai and the Arab peninsula altogether: think they are someone because they are swimming in money. Now.
Luck (=oil) will run out of their mighty arses soon enough and then they will have nothing to attract the world with, nor will they have any such income flowing in to sustain the crazy things going on there.
Jersey applies to the same position to be? I mean, it has beautiful beaches and…that’s it really. Living here is very expensive, coming here as a tourist is expensive – and once you seen it you’ve seen it all.
Then don’t be surprised the reports on how the schools are performing will be even poorer. Their results will be so small it will be undetectable, nothing to write about:) Unless these super-rich and their buddies are planning to build the tallest building in the World…or the copy of our galaxy made of sand and made up of enormously luxurious properties. Or any such nonsense…
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It’s really not a good time for the States to be cutting the rates for the rich immigrants… at the same time as they are increasing social security for the low & middle earners. They have really got this all the wrong way around! One word explains all of this… Elitism.
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Hail me hearties! The “big fish” who think they’re “cod” don’t have to pay taxes like the “minnows”. The “flotsam” who won’t pay their way “worm” their way into the island where they can be “big fish” in a small pond. It’s a kick in the “pirhana teeth” for the locals, but no one in the states will listen to the “crabby” and “carping” underling locals! Have no “trout”, this fiscal discrimination will cause a very fishy smell when the full illegality of it all becomes known and the “sharks” from the international tax people begin to circle. The policy really is “anenome” of the local people, who have to pay the full amount. It’s all a load of “rollicks”.
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For eels hake, Captain Haddock, don’t start this nonsense all over again on every thread.
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Indeed Captain Haddock, I don’t know if you’re doing this on porpoise or just for the halibut…
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What I would like to know is why the JEP didn’t give proper coverage to the excellent alternative proposals on 1 1 K s brought my Deputy Trevor Pitman?
The Deputy totally discredited Senator Ozouf’s argument. As Deputy Pitman pointed out under these new proposals an individual benefiting from a deal in the region of £100.000.000 as he quoted will be allowed to pay just 1% tax on it! Scandalous! Just as bad he also pointed out how in reality Jersey simply does not have the resources to track down what world wide income the super rich have.
The whole proces is a bad joke. I am sick of paying my way while the wealthiest get away almost scott free. How can this be in line with a fairer society that Ozouf is always pretending to support?
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captin haddock(44) that made me smile and chuckle .
a great thing thats free and at the moment un taxed.
it the only thing that great unwashed like myself have left.
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