Jersey tax measure is 'harmful' says EU conduct group

Part of Jersey's tax regime is "harmful" and in conflict with European Union rules, an EU tax code of conduct group heard at a Brussels meeting.

The island's zero-ten tax structure was discussed at a meeting on Friday about whether the system meets EU standards.

Jersey officials are now contesting the view that a measure to stop tax avoidance is "discriminatory".

The zero-ten scheme, introduced in 2008, means many businesses based in Jersey pay no corporation tax.

Finance centre

Officials in the island argue the tax avoidance measure applies to personal tax and not zero-ten.

Jersey's Treasury Minister Senator Philip Ozouf said: "With the exception of that provision, the zero-ten tax structure has not been formally addressed by the commission or the code group.

"Therefore, with the exception of this anti-avoidance measure, nothing has been conveyed to the island authorities that would indicate that the present zero-ten tax structure is in conflict with the code criteria."

Zero-ten was brought in to ensure the island remains competitive as an off-shore finance centre, officials say.