Isle Of Man Begins Social Security Tax Review
by Jason Gorringe, Lowtax.net, London
13 July, 2015
The Isle of Man is to reform the island's social security regime, to ensure that the island's tax and pension arrangements are sustainable beyond 2047.
A proposal is to be laid before the island's Parliament focused on five key areas: the future of state pensions, national insurance (social security tax), working age benefits, workplace pensions, and the island's relationship with the United Kingdom.
The proposed changes are being considered in light of a recent report from Ci65, a consultancy, which suggested that the island's national insurance fund will be exhausted by 2047, seven years earlier than previously projected. The report also found that the Isle of Man's current arrangements are out of date, have not kept pace with the aging population, are based on UK policies rather than local priorities, and have become far too complex.
Under the proposals, the Isle of Man would simplify how national insurance contributions are calculated and levied, and equalize the treatment of employed and self-employed taxpayers.
Treasury Minister Eddie Teare described the proposed reform as "one of the most important and fundamental decisions to be made since the introduction of the welfare state."
Teare said: "This is about the next generation, not the next general election. It is about sustainability. The evidence says our current system is broken and not fit for the future. It is clear that urgent action is needed to put in place simpler and fairer arrangements that will protect our children and grandchildren and be competitive for our economy."
"People have made their views known and we have listened very carefully before coming forward with these options. This is an opportunity to look at revising and improving policies that affect the lives of every man, woman, and child in the Isle of Man."
See all of today's news