Isle Of Man / Ellan Vannin

Isle of Man's zero-10 tax system approved by EU

Uncertainty over the future of the Isle of Man's zero-10 tax system has come to an end after official approval was given by the European Union.

European finance ministers (ECOFIN) have been examining the effects of the regime, in which some companies pay no corporation tax and others pay 10%.

An official decision had been expected in January 2012 but the Manx government was informed of the outcome this week.

Treasury Minister Eddie Teare said he welcomed the end of uncertainty.

'Christmas surprise'

In February, the Isle of Man government announced the abolition of the attribution regime for individuals (ARI) in an attempt to end concerns over zero-10.

ARI is a tax anti-avoidance system which the EU was seen as likely to identify as "harmful".

By withdrawing ARI it was hoped the EU working group would be more likely to view the island's tax regime favourably.

The rates incorporated into the zero-10 regime are said to have attracted business from all over the world to the Isle of Man, including from the e-gaming and space industries.

Chief Minister Allan Bell said: "Confirmation from Brussels was not expected until the new year so today's news is a welcome Christmas surprise for the Isle of Man.

"The outcome of this process is a further endorsement of the island's policy of responsive engagement with international scrutiny while always seeking to defend our own strategic interests."

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