Companies wishing to list on the Junior Stock Exchange are being urged to get their act together before the window for benefitting from income tax relief closes.
The Finance Minister, Dr Peter Phillips, told Parliament yesterday that the special scheme of income tax incentives for companies trading on the junior market is to be phased out.
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 tax for five years from the date of listing.
However, he said the 50 per cent relief for the second five years will be eliminated.
And manager of the wealth division of Stocks and Securities Limited, Kevin Jones, is urging companies which had already been preparing to list, to move swiftly before the window for benefitting from the tax incentive closes.
He also notes that while companies will still be able to derive some benefit if they register before the end of 2016, that deadline is not far off.
The government says it has become necessary to phase out the incentive as it forms a part of tax reform measures which form part of a consolidated generalised incentive regime.
Phillips has 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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