In the Year 2000 the Isle Of Man published its 5 year taxation strategy. Following some modifications in 2002, the result of the strategy was the successful introduction in the Island of the "zero/ten" system of corporate income tax in April 2006. Under this system the standard rate of corporate income tax in the Isle of Man is 0%, with a higher rate of 10% applying to income derived from Isle of Man land and property and income derived from Isle of Man banking business. In addition, in accordance with the strategy, the corporate income tax system in the Island has been simplified and the old Isle of Man income tax exempt regimes have been repealed.
The Isle of Man Income Tax Division has recently published its proposals for the Isle of Man's taxation strategy for the period of 2007 to 2012. The main objectives of the proposals are to:
- continue to simplify the Island's income tax system;
- focus on individual taxation and encourage savings and investment through products provided on the Isle of Man;
- continue to build the Isle of Man's international reputation;
- encourage economic growth; and
- improve tax compliance on the Island.
Proposals for the new strategy include ensuring that our tax system complies with international standards, expanding the Island's network of international taxation agreements and operating the Island's existing network of international taxation agreements effectively. In addition, it is proposed that the strategy should encourage new business and economic sectors to set up operations in the Island and make it attractive for business to retain profits for growth and reinvestment on the Island.
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