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Income tax incentives for Junior Stock Exchange companies to be phased out
2013-10-29 18:01:37 | (0 Comments)
Monique Grange, Assistant News Editor - Radio
Finance Minister Dr Peter Phillips has disclosed that the special scheme of income tax incentives for companies listed on the junior stock exchange will be phased out over time.
The move has become necessary as a result of the government’s tax reform measures which form part of a consolidated generalised incentive regime.
The Finance Minister told Parliament this afternoon that while arrangements will be made for the gradual phasing out of the incentives, a transitional plan will also be put in place.
He said companies listed on the junior stock exchange before January 1, 2014, will continue to enjoy current benefits for the remainder of their unexpired incentive period.
Phillips explained that those companies that enlist between January 1, 2014, and December 31, 2016, will be entitled to the full relief from income for five years from the date of listing.
However, he said the 50 per cent relief for the second five years will be eliminated.
According to Phillips, an administrative mechanism will be developed, as part of the transition period, to allow for the capping of the tax expenditures that arise from the operation of the special scheme of tax relief.
He said the changes are aimed at creating a more productive environment in the country that incentivises producers.
He pointed out that the government cannot secure revenue on the basis of giving up taxes.
The Finance Minister also acknowledged that while the new measures are a difficult adjustment the government is creating a regime which rewards producers with lower rates.
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Source: The Gleaner/Power 106 News
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