{"text":[[{"start":8,"text":"The world’s tax havens are early winners from global rules designed to curb corporate tax avoidance as multinational companies defy expectations that they would flee offshore hubs."}],[{"start":19.08,"text":"Havens including Guernsey and Jersey are projecting big windfalls after they raised their corporation tax rates to align with OECD rules intended to prevent large corporates shifting their profits to low-tax jurisdictions."}],[{"start":32.16,"text":"They had been braced for a potential exodus of companies after agreeing to enforce a global minimum effective tax rate of 15 per cent for multinationals with revenues above €750mn."}],[{"start":44.4,"text":"The OECD-brokered deal was the biggest reform to corporate taxation in more than a century when it was agreed by more than 100 countries in 2021, although it has since been watered down."}],[{"start":55.64,"text":"Charles Parkinson, Guernsey’s Treasury lead, told the FT that fewer than 10 per cent of multinational companies were relocating out of the British Crown dependency as a result of the increases to corporation tax."}],[{"start":68.2,"text":"The Channel island recently doubled its forecast of tax revenues from implementing the rules to £88mn for 2025, the first year for which they applied. Guernsey raised £48mn in total corporate tax revenue the year before, when most multinationals paid a rate of either 0 or 10 per cent, depending on the industry."}],[{"start":88.76,"text":"Jersey operated a similar system before applying the OECD rules and also predicted a “windfall” of tens of millions of pounds in income from the OECD regime, known as “Pillar Two”."}],[{"start":100.4,"text":"Bermuda this month raised its own estimates for its first year of Pillar Two-linked earnings to $291mn, amounting to roughly a fifth of the country’s total expected tax take for 2025-26."}],[{"start":113.12,"text":"Bermuda did not previously levy corporation tax at all but in 2025 introduced a 15 per cent rate to align with the OECD’s regime. It had initially estimated a haul of $188mn but raised its forecast after reinsurers reported outsized profits."}],[{"start":131.2,"text":"Ireland is another country profiting from Pillar Two. Taxes from companies with intellectual property in Ireland, such as Apple, have driven several years of budget surpluses. The finance ministry expects an annual €3.5bn increase in corporation tax revenue from next year as a result of Pillar Two."}],[{"start":147.48,"text":"Giorgia Maffini, tax policy director at PwC, said that if the trend continued, it “would indicate that profits and investment remain there for reasons beyond the tax system”. She cautioned, however, that the initial data should be treated as preliminary."}],[{"start":162.12,"text":"Under the Pillar Two rules, if a multinational is taxed below the 15 per cent effective rate in one country, others can charge top-up levies. This encourages low-tax jurisdictions to join the initiative to avoid other countries collecting money at their expense. However, the Trump administration in January secured a carve-out for US companies from these top-up levies."}],[{"start":183.56,"text":"Tax experts said companies could decide to remain incorporated in offshore havens because of other benefits, such as more flexible regulatory frameworks, infrastructure and educated workforces."}],[{"start":194.36,"text":"Additionally, the cost of complying with Pillar Two reporting requirements could make some businesses resistant to incurring the further costs that could come with moving out of these jurisdictions, said Daniel Bunn, chief executive of the Tax Foundation, a US think-tank."}],[{"start":210.04,"text":"Companies that fall within scope of the Pillar Two regime are required to file detailed reports on their operations — even if no additional tax is ultimately due."}],[{"start":219.48,"text":"“Many companies saw this transition as incredibly costly from a compliance perspective. That probably meant they leaned towards keeping existing [offshore] structures for continuity,” said Bunn."}],[{"start":229.68,"text":"The longer-term impacts of the rules would only become apparent over the next few years, said John Vella, a director at Oxford university’s Centre for Business Taxation. “Companies will want to wait a bit longer to see how the rules bed in,” he said."}],[{"start":243.08,"text":"Parkinson argued that Guernsey’s tax receipt boost should be treated as “a short-term windfall”, given the continued risk of businesses changing their behaviour to minimise their tax liabilities."}],[{"start":253.12,"text":"Bermuda’s premier, David Burt, has said 2025 could be the “high point” for its corporation tax revenue, in part because the country will offer tax credits to companies, which could reduce receipts over time."}],[{"start":265.06,"text":"Jersey has also cautioned that there was “significant uncertainty as to the scale of the total extra receipts and how long [it] could expect to receive such receipts”."}],[{"start":274.12,"text":"An official at the Paris-based OECD said companies’ location decisions reflected “infrastructure, regulatory certainty and access to labour, alongside taxation”."}],[{"start":283.38,"text":"The organisation estimated in July that global tax receipts would rise by between 3.2 per cent and 5.4 per cent, or $91bn-$155bn, a year, as a result of the global minimum tax, although this was below previous estimates."}],[{"start":301.92,"text":"Additional reporting by Jude Webber in Dublin"}],[{"start":309.88,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1793004457_7381.mp3"}