JERSEY: Pair want States to follow Jersey in forecasting corporate tax revenue

As published on: bailiwickexpress.com, Wednesday 29 October 2025.

Concerns that the States may be overestimating revenue from new global corporate taxes could be addressed by adopting a more conservative approach that is being used by Jersey’s government, a pair of deputies have argued.

Deputies David Dorrity and Andy Sloan will ask the States to direct Policy & Resources to to consider using the forecasting models used by the States of Jersey to assess how much money may be raised by the Pillar 2 Global Minimum Tax Rules.

Pillar 2 is a 15% international tax on the profits of large multi-national corporations, ensuring the largest firms pay tax regardless of where they are based to avoid the shift of profits to low-tax jurisdictions.

It came into force locally at the start of the year for multinational companies with global annual turnover of more than €750m.

The Treasury’s current assumption is that the tax will raise an additional £40m per year for the public purse – but no cash will be received until 2027. It has revised its forecast up from £10m and £30m over the past few years.

Deputy Dorrity told Express he is fearful the Trump administration may withdraw US involvement in the scheme which could plunge it and projected revenues for governments into uncertainty.

“Given the ongoing uncertainty, and until Pillar 2 receipts are actually realised in 2027, I would like Treasury and P&R to review and perhaps adopt Jersey’s more conservative approach when forecasting Pillar 2 revenues in Guernsey’s 2026 Budget,” Deputy Dorrity said. 

“I believe that should they be successful, the resulting inequities between US multinationals and those headquartered in the rest of the world might ultimately jeopardise the success of Pillar 2 – or at least force the OECD to revisit its design.”

While he has been assured by officials that this disruption has been factored into predictions, he noted that Jersey has “adopted a more cautious approach” for accounting the cash in its budget – whereas Guernsey is already including hypothetical cash for 2025.

“Where Guernsey has included projections for 2025 and 2026 – totalling £79 million to the end of 2026 – Jersey has opted to exclude 2025 – recognising receipts only once they become reasonably certain and earmarking these funds for investment or reserves. 

“In contrast, Guernsey’s approach appears to incorporate these amounts directly into revenue forecasts – albeit with strong caveats.”

He said following Jersey would “mitigate the risk of overstating the island’s fiscal position and protect against potential financial shocks”.

The Scrutiny Management Committee has also warned against relying on future revenues from Pillar 2 in the short term.

Deputy Sloan, also Scrutiny President, in a letter to P&R said “the inclusion of approximately £40 million in Pillar 2 receipts within the 2026 Budget, before any collection has commenced, raises concern. 

“The Budget acknowledges that these estimates are based on ‘secondary data sources’ and should be treated with caution. Recognition of such uncertain revenue sources risks overstating the fiscal position and is in our view not a prudent approach. “

The budget will be debated by the States from 4 November.