New global tax regime could benefit Island by £35 million a year

Treasury Minister says income will be a welcome contribution

Implementing rules around a new global tax regime could help the Island broaden its tax base and raise a forecast £35 million annually from 2027 onwards.

That's the prediction from Treasury over measures being introduced by the OECD as part of its so-called Pillar Two initiative.

The move is designed to ensure businesses that operate across international boundaries pay a fair share of tax wherever they are based and generate profits.

Under the initiative a Qualified Domestic Minimum Top-up Tax (or QDMTT for short) will mean multi-national enterprises will pay a minimum 15% taxation in the profits they generate in the Isle of Man.

Also an income tax rule, to be known as a Multinational Top-up Tax will apply to the very small number of MNEs that have their ultimate parent entity in the Island or, in certain situations their intermediate parent entity. 

It will ensure profits arising outside the Isle of Man are subject to taxation at a rate of at least 15%.

Treasury Minister, Dr Alex Allinson, says the revenue represents a welcome contribution.