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Will you be my (tax) valentine?

Kitty Miv, Editor
13 February, 2020

As memories of Christmas and New Year dim, the lovers' holiday is almost upon us, although the Irish electorate clearly didn't get the memo from PM Leo Varadkar at the recent election, when they delivered a rebuke to prior Fine Gael government in the form of a fairly inconclusive result, with none of the main parties pulling ahead.

After a fairly heavy-going few weeks in terms of tax, economic and political news, though, it feels like time for something a little more light-hearted.

In the spirit of the day, then, and in a rare appearance by Jersey in this column, it emerged that married women will soon be able to discuss their tax affairs with the Jersey tax authority without their husband's permission, following Parliamentary approval of an update to Jersey's tax rules.

On February 4, lawmakers approved the proposed change by 40 votes to two, with two abstentions.

Under the current rules, married women are prevented from discussing their tax affairs with Revenue Jersey without their husband's permission, with married women only permitted to file their own tax return if they have opted for a separate assessment.

Dragging things kicking and screaming into the modern era, from January 1, 2021, both spouses and civil partners will be able to contact Revenue Jersey to discuss the couple's tax affairs and update their tax information.

The changes will mean that in 2022 (for the 2021 tax year of assessment), the couple will still receive a joint tax return, but will both have the right to sign it. They will each have equal right to access and manage their tax affairs with Revenue Jersey, and they will have joint responsibility for paying income tax.

Treasury Minister Susie Pinel explained that the reforms "will finally give equal rights to both spouses and civil partners under Jersey's tax law" and "remove the archaic presumption in the current law that a wife's income is deemed to belong to her husband."

So... um... well done, Jersey? Just a couple of centuries behind the times!

Meanwhile, in Finland the authorities decided to follow the edict of "if you love something, set it free", cancelling plans for the introduction of an exit tax on individuals. (Although the reasoning behind the move was not especially romantically-motivated, it must be said; a report from the Finnish Ministry of Finance reportedly concluded that the introduction of an exit tax on natural persons would be too challenging from an administrative point of view.)

The report was commissioned to explore the possibility of introducing a tax to prevent the avoidance of Finnish sales, gift, and inheritance taxes by non-residents. This tax would have applied to the appreciation of the assets of persons who moved abroad from Finland.

However, according to a statement issued by the Ministry on February 7, 2020, such a tax "has many challenges and problems". It continued:

"The reform would require detailed regulation, which would complicate the Finnish tax system. Effective implementation of the tax model and the information it requires could become very challenging in practice."

The Ministry concluded that the tax would affect only a small number of wealthy people and raise relatively small sums in revenue. It also found that the tax could have a detrimental effect on Finland's competitiveness and attractiveness as an investment destination.

Let's hope that all of those wealthy potential taxpayers take advantage of the freedom granted by the Finnish authorities and come back. Hopefully bringing their Krone with them.

Until next week!


Tags: Treasury


About the Author


Kitty Miv, Editor

Kitty was born in Argentina in 1960 to a Scottish cattle rancher and his Argentine wife. Educated in Edinburgh and at Princeton, Kitty worked for the World Bank as an economist, where she met and married an emigre Iranian banker. During her time with the Bank, Kitty worked in a number of emerging markets, including a spell in the ex-USSR as a Transition Economies Team Leader. Kitty is now a consultant in Brussels and has free-lance writing relationships with a number of prominent economic publications. kitty@lowtax.net

 

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