Remember meForgot password?
    Log in with Twitter

article imageJersey: low-tax hub on the EU frontier

By Antoine POLLEZ (AFP)     Nov 8, 2017 in World

The Channel island of Jersey has come under the spotlight with the publication of the "Paradise Papers", highlighting its status as a tax destination for multinational companies.

Here are the key facts about the largest of the Channel Islands, located between France and Britain.

- Territorial status -

As a Crown Dependency, Jersey is not part of the United Kingdom and does not have any representatives in Westminster, instead being administered by a local assembly.

However, it still recognises Queen Elizabeth II as its head of state. The monarch has a permanent representative in Jersey and gives her royal assent to the main laws passed on the island.

- Foreign relations -

Britain carries out diplomatic duties on behalf of Jersey, which cannot sign international agreements but can have the Britain's ratification of such instruments extended to them.

However, it has attempted to forge its own identity on the world stage, and in 2007-2008 signed an agreement that the UK would not act internationally on its behalf without prior consultation.

Its leaders have recently met with foreign heads of state, with Chief Minister Ian Gorst visiting Saudi Arabia and Bahrain.

- History -

Jersey became part of the Duchy of Normandy in 933. When Norman ruler William the Conquerer invaded England in 1066, the island, the duchy and the kingdom of England were all governed under one monarch.

England's King John lost the Battle of Rouen against French King Philippe-Auguste in 1204, signalling the loss of continental Normandy.

But the Channel Islands refused to align with the French king and were persuaded to side with King John.

Jersey was occupied by Germany during World War II from July 1940 until May 1945, when Germany surrendered.

- Cultural influences -

'Superman' actor Henry Cavill is a glamorous Jersey export
'Superman' actor Henry Cavill is a glamorous Jersey export

Britain remains the dominant influence on the island of 100,000 inhabitants, who use British currency and passports, the English language and drive on the left.

Its most famous exports include Jersey Royal potatoes, Jersey cows, TV detective series Bergerac, Superman actor Henry Cavill and former England footballer Graeme Le Saux.

- Tax status -

The island has a unique relationship with the European Union, which allows it to enjoy free trade of goods with the continent while remaining free to set its own tax rules.

As a result, it has developed a very accommodating tax system with a zero percent corporate tax rate except for companies offering financial services, who pay 10 percent on profits, and for water and energy suppliers, who must pay 20 percent.

The maximum rate of income tax is set at 20 percent, making it an attractive destination for international commerce, with finance accounting for 58 percent of the local economy.

In December 2016, Jersey was home to 30 banks with £111.5 billion pounds (126 billion euros) in deposits, and 231 investment funds looking after £237 billion pounds, according to Jersey Finance, the sector's lobby group.

More about US, Britain, Finance, Tax, Politics
More news from