The action sets them apart from Guernsey, which responded to a challenge thrown down by the European Union to the crown dependencies in October 2009 by announcing “a presumption” of a move to a 10 per cent corporate rate.
In a less far-reaching proposal, Jersey and the Isle of Man plan to withdraw anti-avoidance rules intended to ensure that business owners are regularly paid taxable dividends instead of letting the income accumulate tax-free within the company. The EU argues that this rule is discriminatory as it only applies to shareholders who live on the islands. That breaches its “code of conduct”, designed to stop “predatory” tax policies that restrict tax privileges to foreigners.
At Tuesday’s meeting of EU finance ministers in Brussels, a directive to bolster administration co-operation to counter tax fraud was adopted without further discussion. This bars EU member states from refusing to supply information about taxpayers from other EU countries on the grounds that this is held by a bank or other type of financial institution
© Financial Times
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