The Government is seeking to encourage overseas companies to establish their head offices in Jamaica, through a Bill that exempts officers of such companies from the payment of income tax.
The Bill Income Tax (Amendment) Act was tabled during Tuesday's (Sept. 18) sitting of the House of Representatives.
According to the Memorandum of Objects and Reasons, the Bill exempts persons, who are not residents of Jamaica and who perform group head office activities, from the payment of income tax.
"It (is) hoped that by facilitating the establishment of group head office companies in Jamaica, other companies will realise the economic benefits, including increased foreign investments, access of alternative capital providers, new markets and the creation of new jobs," stated the Memorandum.
The Bill defines an approved group head office company as an entity or other body corporate that operates in Jamaica and other parts of the world and establishes its head office and performs, among other activities, the supervision, management or monitoring of its operations; accounting, data processing, engineering, and other technical support; centralized treasury management and similar funding activities; and other such activities, as may be specified by the Minister, by order, published in the Gazette.
A company or other body corporate may apply to the Minister, in the prescribed form and manner, for a certificate designating it as an approved group head office company.
However, the Bill seeks to restrict the granting of the certificate, unless the Minister is satisfied that the applicant is incorporated or registered in Jamaica; is engaged in or proposes to engage in group head office activities here; and proposes to employ or has already employed 30 per cent or more of its employees to perform group head office activities from among citizens of Jamaica, who are resident in Jamaica.
The Bill also imposes an obligation on a group head office to notify the Minister in writing, at least 90 days before the cessation of employment of every employee to whom the exemption is given.