The Channel Islands of Jersey and Guernsey have signed intergovernmental agreements (IGA) with the UK on a package of tax measures built to boost the automatic exchange between of tax information between the countries.
The agreement enhances the current tax exchange provisions, which have been in existence since 2005 and provides for information to be exchanged between the authorities of the two Crown Dependencies and the United Kingdom under measures equivalent to the EU savings tax directive.
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The IGA that is based on the model I Foreign Account Tax Compliance Act was signed in London by the Island’s chief minister; Peter Harwood and the UK’s exchequer secretary to the treasury, David Gauke.
The IGA’s signed with the UK will be subject to approval and will have to be ratified by both the states before they come into effect.
The chief minister will submit a report which requesting the UK to extend the OECD Multilateral Convention on Mutual Administrative Assistance in Tax Matters to Guernsey.
The UK IGA will include details of the alternative reporting regime for UK resident non-domiciled individuals. The guidance notes are being developed jointly between the governments of Guernsey and Jersey.
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By GlobalDataFiona Le Poidevin, chief executive of Guernsey Finance said: "It enhances the provisions regarding automatic exchange of information which have already been in place since 2011 and, once again, demonstrates our determination to tackle tax evasion.
"The OECD has continually reaffirmed that Guernsey adopts international standards of tax transparency and exchange of information. This agreement further reinforces our status as a leader in making strides to combat tax evasion and we look forward to building on this even further by signing a similar Model I agreement with the US, in relation to FATCA, in the near future," he added.
Deputy Harwood said: "The two agreements with the UK and the US have been supported by our [finance] industry, being key to a sustainable future for the finance sector and securing our global reputation for tax transparency.
"Our approach to US and UK reporting will provide our industry with a very strong platform to compete on the world stage against weaker, less transparent jurisdictions," he added.
Gorst Jersey chief minister said: "This agreement once again demonstrates our long-held commitment to international cooperation on tax matters."
Harwood has also singed Tax Information Exchange Agreements (TIEAs) with Slovakia and Gibraltar, a move which follows Guernsey’s recent signing of two ‘partial’ Double Taxation Arrangements (DTAs) with Poland.
Guernsey has recently signed 48 TIEAs and 21 DTAs, including eight ‘full’ DTAs and 13 ‘partial’ DTAs.
