Income Tax paid by High Value Residents

WQ.105/2019

WRITTEN QUESTION TO THE MINISTER FOR TREASURY AND RESOURCES

BY THE DEPUTY OF ST. PETER

ANSWER TO BE TABLED ON TUESDAY 26th FEBRUARY 2019

Question

Further to her responses to Written Question 39/2019 and 65/2019, will the Minister –

1. state the total amount of Income Tax paid by High Value Residents in respect of the tax year 2017; and
2. commit to undertake a review in order to show the amount of Income Tax paid by High Value Residents compared with the amount that would be paid by such High Value Residents if they were taxed on the same basis as other Islanders?

Answer

Taxpayer data relating to the 2017 tax year will not available until after the first quarter of 2019. This response has been prepared based on the latest completed tax year for which audited figures are available (i.e. the 2016 tax year).

It is assumed the reference to High Value Residents' ("HVRs") relates to those individuals who come to Jersey by obtaining "entitled status" under Regulation 2(1)(e) of the Control of Housing and Work (Residential and Employment Status) (Jersey) Regulations 2013 and those who have access to preferential tax rates.

1. The personal income tax paid by HVRs for the 2016 tax year was about £12.3m.
2. Please see the updated response to WQ39/2019. This provides an indication of the amount of tax that would have been paid if those HVRs had paid 20% on all of their taxable income. Attention is drawn to the notes accompanying part (e) of the response to WQ39/2019. For the avoidance of doubt, the Treasury does not intend to undertake any further work in relation to this issue; Members attention is drawn to the most recent review of the HVR tax regime which reported in December 2016 (see: /assemblyreports/2016/r.130-2016.pdf).

WQ.39/2019

WRITTEN QUESTION TO THE MINISTER FOR TREASURY AND RESOURCES BY THE DEPUTY OF ST. PETER

ANSWER TO BE TABLED ON TUESDAY 29th JANUARY 2019

Question

Will the Minister advise, in respect of the 2017 tax year –

1. how many Jersey residents (excluding High Value Residents), if any, paid more than the minimum tax payment of £125,000 per annum that applied to High Value Residents;
2. what the average annual tax payment was for any such residents and how much income was generated from the group in total;
3. how many High Value Residents resided in Jersey;
4. what the average tax paid by such High Value Residents was; and
5. what the total increase in Income Tax paid would have been if High Value Residents had paid 20% Income Tax on all their earnings?

Answer

Taxpayer data relating to the 2017 tax year will not available until after the first quarter of 2019. This response has been prepared based on the latest completed tax year for which audited figures are available (i.e. the 2016 tax year).

It is assumed that the reference to High Value Residents' (HVRs') relates to those individuals who come to Jersey by obtaining "entitled status" under Regulation 2(1)(e) of the Control of Housing and Work (Residential and Employment Status) (Jersey) Regulations 2013 and those who have access to preferential tax rates.

1. There were 119 taxpayers (excluding HVRs) who had a tax liability of more than £125,000 for the 2016 tax year. In this context a "taxpayer" can be an individual, a married couple or a civil partnership.
2. The total income tax generated from those 119 taxpayers identified in (a) was about £22m, resulting in an average tax payable by that group of approx. £185,000.
3. There were 101 HVR taxpayers in the 2016 tax year.
4. The total income tax generated from those 101 HVR taxpayers was about £12.3m, resulting in an average tax payable by that group of approx. £ 122,000
5. This is estimated to be £11m for the 2016 tax year.

Please note the figure in (e) is markedly higher than for other tax years (including current estimates for the 2017 tax year) and hence should be treated with appropriate caution. Furthermore the figure in (e) simply reflects the differential between the application of the 1% rate and a 20% standard rate and takes no account of the likely behavioural changes that would occur if the standard rate were to be applied.