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No word on tax cut for reinsurers

Château de la Muette: the Paris seat of the OECD (File photograph)

The government has confirmed a continuing working brief, keeping track of developments on international tax considerations that could force the island’s largest multinationals to pay a global minimum tax.

But a spokesman would not confirm there has been government advice to reinsurers that local tax relief might be available should they be impacted.

When asked about this, a government spokesman would only say: "There have been no formal discussions on these matters. The work/discussions are still ongoing at an international level, so it is still too early to speculate on changes to the Bermuda framework."

Rating analysts have reported they were told a corporate tax break may be a way of mitigating the effects of the proposed international tax requirement.

The Organisation for Economic Co-operation and Development has proposed landmark reform to the international tax system, to force multinationals to be subject to a minimum 15 per cent tax rate from 2023. The OECD’s minimum tax would apply to companies with revenues above €750 million.

Standard and Poor’s said in a recent report some Bermudian re/insurers could see their corporate income tax rate jump from zero to 15 per cent.

And S&P analysts said they heard from Bermuda re/insurance executives that government authorities could possibly lower the payroll tax as a potential offset.

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Published September 14, 2022 at 8:08 am (Updated September 14, 2022 at 8:08 am)

No word on tax cut for reinsurers

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