LOW TAX COUNTRIES
Andorra
Anguilla
Antigua & Barbuda
Aruba
Australia
Bahamas
Barbados
Belize
Bermuda
British Virgin Islands
Cayman Islands
Cook Islands
Costa Rica
Cyprus
Dominica
Dominican Republic
Gibraltar
Hong Kong
Isle of Man
Jersey & Guernsey
Liechtenstein
Luxembourg
Malta
Mauritius
Panama
Singapore
St.kitts & Nevis
Switzerland
Turks & Caicos
Vanuatu
Index of Articles
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THE CHANNEL ISLANDS
About The Channel Islands
The Channel Islands are a group of British-dependent islands off the coast of Normandy, France, in the English Channel. They comprise two separate countries: the bailiwick of
Guernsey and the bailiwick of Jersey, and have a total population of about 160,000
The inhabited islands of the Channel Isles are Jersey, Guernsey, Alderney, Sark, Herm (the main islands); Jethou, Brecqhou (Brechou), and Lihou. All of these except Jersey are in the Bailiwick of Guernsey, but the Minquiers and Ecréhous as well as the Les Dirouilles and Les Pierres de Lecq (the Paternosters), uninhabited groups of islets, are part of the Bailiwick of Jersey. Burhou and the Casquets lie off Alderney. As a general rule, the larger islands have the -ey suffix, and the smaller ones have the -hou suffix; this is believed to be from the Old Norse ey and holmr respectively.
The Chausey islands south of Jersey are not generally included in the geographical definition of the Channel Islands but occasionally described as 'French Channel Islands' in English in view of their French jurisdiction. They were historically linked to the Duchy of Normandy, but they are part of the French territory along with continental Normandy, and not part of the British Isles or of
the Channel Islands in a political sense. They are an incorporated part of the commune of Granville (Manche), and although popular with visitors from France, they are rarely visited by Channel Islanders, as there are no direct transport links from the other islands.
In official Channel Island French (see Jersey Legal French), the Islands are called 'Îles de la Manche', while in France, the term 'Îles anglo-normandes' (Anglo-Norman isles) is used to refer to the British 'Channel Islands' in contrast to other islands in the channel. Chausey is referred to as an 'Île normande' (as opposed to anglo-normande). 'Îles Normandes' and 'Archipel Normand' have also, historically, been used in Channel Island French to refer to the islands as a whole
Jersey's economy is based on international financial services, agriculture, and tourism. In 1996, the finance sector accounted for about 60% of the island's output. Potatoes, cauliflower, tomatoes, and especially flowers are important export crops, shipped mostly to the UK. The Jersey breed of dairy cattle is known worldwide and represents an important export income earner. Milk products go to the UK and other EU countries.
Tourism accounts for 24% of GDP. In recent years, the government has encouraged light industry to locate in
Jersey, with the result that an electronics industry has developed alongside the traditional manufacturing of knitwear. All raw material and energy requirements are imported, as well as a large share of Jersey's food needs. Light taxes and death duties make the island a popular tax haven. Living standards come close to those of the UK
BUSINESS IN JERSEY And GUERNSEY
Jersey and Guernsey Not In EU Fiscal Area
The islands of Jersey and Guernsey are self governing. Britain is responsible for their external affairs including negotiations with the European Union; under the UK's accession treaty with the EU, Jersey and Guernsey form part of the single market but are outside the EU fiscal area. Neither island generally enters into double-tax agreements, but have treaties with the UK and each other, and a limited treaty with France.
Economy Buoyant But Jersey and Guernsey are Full Up!
The Channel Islands have a buoyant economy dominated by the finance sector. Unemployment is very low. The political stability in
Jersey and Guernsey together with their consistently low tax status and its international reputation as important financial centres make them an attractive prospect to foreign investors and workers. To protect the islands' limited resources the governments tend to discourage labour-intensive inward investment that is controlled by non residents. There are no investment grants or incentives, but electronics and other knowledge-based industries have been encouraged.
Jersey's Low tax Specialisations
Jersey has particularly strong banking, investment fund and trusts sectors, with very well-developed advisory and financial infrastructure.
The Jersey Financial Services Commission's quarterly report for the period to 30th June 2006 shows that almost 50 banks held bank deposits of GBP183 billion, and funds domiciled on the island stood at GBP160 billion.
There are a number of low-tax business formats, including International Business Companies, 'Exempt' companies, and Limited Partnerships. (N.B. In accordance with the Island’s commitment to the European Council of Finance Ministers (Ecofin), Jersey has pledged to ensure that no new International Business Companies are capable of being formed from 1st January, 2006.)
Guernsey's Lowtax Specialisations
Guernsey has Europe's largest captive insurance sector, and also has strong banking, investment fund and trusts sectors, with very well-developed advisory and financial infrastructure.
The Channel Islands Stock Exchange is based in Guernsey. There are a number of low-tax business formats, including International Companies, 'Exempt' companies, and Limited Partnerships.
The Channel Islands v. the EU and the OECD?
Jersey's and Guernsey unique situation with regard to the EU is both a strength and a weakness. The islands will remain a favoured base for holding and trading companies working into the EU, and for e-commerce activity; but they have the EU and the OECD to contend with. After several years of 'hands-off' policy in regard to
Channel Islands taxation, the UK government in 2002 threatened Jersey and Guernsey with sanctions if they didn't fall in line with EU information-sharing rules.
Both islands signed a 'commitment' letter to the OECD in February 2002, but it contained an 'Isle of Man' level playing field clause making changes dependent on comparable changes in Switzerland and the USA. By mid-2003, however, the OECD seemed to have forgiven
Jersey and Guernsey, and was assisting them to design a '0/10' corporate tax system.
In May, 2002, it became clear that Jersey, along with its fellow UK dependent territories
Guernsey and the Isle of Man, was ready to sign up to the EU information-sharing regime. After the EU finally reached its compromise agreement on the Savings Tax Directive in early 2003, Jersey decided, along with Guernsey and the Isle of Man, to apply a withholding tax to the returns on personal savings for EU residents. The Directive came into force on July 1, 2005
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