- Special scheme of income tax incentives associated with the Junior JSE to be phased out.
- The transition is being done in light of the tax reform measures being undertaken.
- This move will provide a more competitive tax environment for businesses across the board.
Government has introduced a transition period for the phasing out of the special scheme of income tax incentives now enjoyed by companies listed on the Junior Market of the Jamaica Stock Exchange (JSE).
This was disclosed by Minister of Finance and Planning, Dr. the Hon. Peter Phillips on Tuesday, October 29, during a statement in the House of Representatives on the Omnibus tax incentive legislation.
Dr. Phillips said that in light of the tax reform measures being undertaken, which seek to provide a more competitive tax environment for businesses across the board, arrangements will have to now be made for the gradual phasing of this special scheme for the junior market.
“Companies listed on the exchange prior to January 1, 2014 will continue to enjoy their current benefits for the remainder of their unexpired incentive period. Between January 1, 2014 and December 31, 2016, companies that list on the Junior Market will be entitled to enjoy full relief from income for a period of five years from the date of listing,” the Finance Minister said.
He added that to help to ensure proper control of this transitional taxation regime, a mechanism will be developed to allow for the capping of the tax expenditures that will arise from the operation of this special scheme of tax relief.
The Omnibus legislation is an important structural benchmark of the four-year Extended Fund Facility agreement with the International Monetary Fund (IMF) and seeks to provide a framework for a new regime to govern all tax incentives.
Two of the Bills, Fiscal Incentives (Miscellaneous Provisions) Act and the Income Tax Relief (Large Scale Projects and Pioneer Industries) Act 2013, were tabled in the Lower House.
The others to be tabled are the Customs Tariff (Revision) (Amendment) Resolution 2013, and the Stamp Duty (Amendment of Schedule) Order 2013.