Wealthiest income tax cap to stay

Mr Bell told the keys the tax cap had been a success

The wealthiest people on the Isle of Man will continue to have their income tax capped at £100,000, treasury minister Allan Bell has said.

Michael MHK David Cannan asked Mr Bell in the House of Keys whether he planned to set aside the policy.

Mr Cannan said it would be unfair to keep the cap as the island was facing financial uncertainties following the cut income from VAT revenue.

But Mr Bell said the scheme, introduced in 2006, brought enormous benefits.

The policy to cap income tax at £100,000, irrespective of earnings, was introduced in the 2006 budget.

Pensioner rebate

It was intended to stimulate investment in the island by attracting high net-worth individuals and entrepreneurs.

"We currently have nearly 90 people on the tax capped list. Those people are bringing something like £9m a year," Mr Bell told members on Tuesday.

"Overall, allowing for the small amount we lost initially, this whole scheme has brought in roughly £8m a year extra tax in the last three years - and that is going to continue.

"By bringing in that £8m extra I have been able to enhance the personal allowance tax credit so that nearly 11,000, mainly low income, pensioners have been able to get a rebate from treasury of £550 per person every year."

The Isle of Man has an 18% rate for higher rate tax payers and 10% for lower earners.