Isle of Man looks to attract more Chinese investors

The Isle of Man can be an offshore tax haven to Chinese investors who plan to develop business in Europe, a senior official of the Isle of Man said over the weekend.

The Isle of Man has a "zero to 10" tax system, with only banks, property companies and retailers paying 10 percent tax on profits while other companies pay no tax on such earnings, Michael Charlton, international director for the Isle of Man Government's Department of Economic Development, said when he met media Friday.

There is also no withholding tax, no inheritance tax, no capital gains tax and no stamp duty, Charlton said.

The Isle of Man, a self-governing British Crown Dependency, is located in the center of the British Isles with the same time zone as London. It is a member of the British Commonwealth but it has independent law and tax systems.

Compared with other offshore financial centers such as Virgin Islands or Singapore that Chinese investors are familiar with, the Isle of Man is closer to London, one of the world's global financial centers, and the EU market, he said.

Moreover, enterprises that set up offices and create jobs in the Isle of Man can access capital and other grants of up to 40 percent of initial costs, according to Charlton.

The Isle of Man is not a member of the EU but it has full EU market access for both manufactured and agricultural goods, so it is a good gateway for Chinese enterprises who want to export their products to the EU market, he said.

"The number of Chinese companies investing in the Isle of Man is still quite modest but it is growing all the time," Charlton said, noting the Isle of Man is not well-known enough so the government set up an office in Shanghai in 2012 to promote itself in China.

A Chinese delegation led by Jiang Yang, vice chairman of China Securities Regulatory Commission, will visit the Isle of Man this week and plan to sign a memorandum of understanding with the financial regulator of the Isle of Man, according to Charlton.